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Author: jbking Big gold star, 5000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: of 2209  
Subject: Re: Define Core Funds Date: 2/3/2007 12:38 AM
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Greetings,

I think you are missing the point of how to view a core fund. Here are a few article links with some explanations:

From http://news.morningstar.com/article/article.asp?id=167812&_QSBPA=Y :
"Core investments are the workhorses of your portfolio. Most of the time they are not flashy. They may even be--dare I say it--boring. But that's okay. Because you can rely on core funds year after year, they'll help you reach your goals.

Core holdings can be index, exchange-traded, tax-managed, or actively managed funds. They can be stock or bond funds, or funds that combine the two asset classes. Until your portfolio is sufficiently large, you're better off using funds for your core holdings as opposed to individual stocks or bonds. That's because you want stability in your core holdings and that generally comes from holding a broader group of diverse stocks and/or bonds."

From http://news.morningstar.com/article/article.asp?id=181077&_QSBPA=Y :
"When I start building a portfolio, I like to begin with some funds that can stand the test of time. One of the most important features I look for is consistency: How have these funds performed over good and bad markets? If I can find a 5-star fund that meets my consistency criteria, that's all the better."

Additionally, here are a couple of other links from M*:
http://news.morningstar.com/article/article.asp?id=168529&_QSBPA=Y
http://news.morningstar.com/article/article.asp?id=169317&_QSBPA=Y

The general idea is to have some funds that are a kind of "set it and forget it" type of fund in terms of it being in the portfolio. The allocation may be worth watching but these are the cornerstone of the portfolio kind of like the foundation of a house to use a metaphor.

Regards,
JB
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