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Subject:  Re: How do I ensure diversity in mutual funds Date:  1/5/2000  3:09 PM
Author:  dweiss3 Number:  17391 of 88496

I was looking the other day at all 7 of my mutual funds and trying to determine how much tech exposure I had. Using the Morningstar site, I checked the top five holdings of each of my funds. I found that the Vanguard 500 Index and the T. Rowe Price Science and Tech funds both hold Microsoft and Cisco in their top 5. Further, of the top 10 holdings of my 7 funds, there were only 51 unique entries. Of the 51, twenty were what I would call "tech" stocks. Three stocks were held by three of the funds (Microsoft, Intel and Exxonmobil) and seven more stocks were held by two funds (Cisco, IBM, Qualcomm, Lucent, Walmart, Merck, and Sony). This surpised me because my 7 funds include a large cap value fund, a small cap index fund and an international fund.

My recommendation is to look at the specific companies held by funds that you are considering for diversificaiton to ensure that there is not too much overlap.

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