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I have the option to buy company stock 'fund' shares in my 401K. I believe that
the industry (Pharma) and the company is a winner long term. I also have and
index fund in my plan : Spartan US Equity Index Fund.

Should I allocate across the two or only buy the stock fund?>>


As you probably know, the index fund is a big favorite around here. Certainly, buying only one stock is a very risky strategy. If the stock is a big winner, than of course you win big, but putting all your eggs in one basket is a strategy which very few would recommend.

Of course your knowledge about the company may give you an advantage in evaluating its long-term prospects, but if this is your only or primary source of retirement investing, adding a healthy chunk of diversificatin through an index fund is a pretty good idea.

Best of luck in your choice,

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