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Subject:  Re: How Do I Balance My Risk? Date:  1/8/2008  1:30 AM
Author:  CycleGirl Number:  12281 of 20640

An IRA account (Roth or Traditional) can have any number of individual investments within it. If your account type doesn't allow you to hold more than one mutual fund within it, you should be able to call the custodian (Templeton, I assume) and open an account that allows you to invest in any kind of security. Then you can have them to transfer your mutual fund shares into that account.

My IRA is with Fidelity - and I'm not trying to sell them - I just happen to know that they offer IRAs that allow investments in stocks, mutual funds, bonds, ETFs, etc. There are no fees. I expect that Vanguard and other top investment companies have similar offerings.

You should also know that you can transfer your assets from one custodian to another. For example, if you decided that you wanted to go with Vanguard, you can get a form from Vanguard and instruct them to transfer your assets from your old account to your new account. They are SO happy to do so!

WRT to investments, foreign stock funds are certainly important. However, I would recommend that you allocate a percentage of your investments in a few different asset classes. For example

30% Foreign stock
30% Domestic large cap stock
30% Small cap stock
10% Bonds

After you decide what you want your asset allocation to look like, you'll want to find good investments within those asset classes. There are two schools of thought on stock mutual funds.

1. Buy only index funds with extremely low expense ratios. Vanguard index funds (like VFINX) and Fidelity Spartan funds are good examples. This school of thought quotes the statistic that most mutual funds under perform their index.

2. Buy best-in-class managed funds. A 4 or 5-star Morningstar rating is a good starting point. Make sure they're no load and have low expense ratios. Less than a 1% expense ratio is pretty good. I've had good luck with FDFFX. This fund holds both domestic and international stock. A couple of my foreign stock mutual funds are Janus Overseas JAOSX and Fidelity International Discovery FIGRX. All of these funds are no-load, 5-star rated, and have low fees.

Whew! I hope that all of this helps you.

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