Investment Strategy #6: Aggressive growth stock funds
Stock funds are a low-risk way to invest in the market. Thanks to diversity and professional management, you’re not likely to suffer big losses, even if you invest in areas that would be highly risky if you bought individual issues.
Such funds offer the potential for high returns. They buy speculative stocks rather than blue-chips. They might have bought Home Depot a few years ago, but not now, when they’re Wall Street’s favorite.
Many aggressive growth funds specialize in small-company stocks. Most stock market analysts focus on the 3,000 largest companies, driving up demand and stock prices. Other companies may be overlooked and undervalued, so there may be more opportunities to discover bargains among smaller companies.
– Some aggressive-growth funds pursue volatile strategies
They may buy on margin, sell short, and use various options maneuvers. They may cut back on diversification by holding relatively few stocks. With the Money Movement Strategy, you normally will do well using these funds.
Sector funds invest in one particular industry. You may feel confident that the energy industry will prosper in the 1990s. But do you buy a giant like Mobil? A company that provides drilling rig services? A natural gas exploration company/ An energy sector fund will give you a professionally selected mix.
– Sector funds rise and fall as their industries go in and out of favor
Utility funds, for example, tend to rise and fall with the bond market reacting to interest rate moves. Energy funds will post gains on higher oil prices while fears of a recession will drive down retail funds.
Connect with us today to discuss which stock options are right for you & yours!
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