BANKING
PERSONAL FINANCE
- Bargains
- Banking
- Budgets
- Calculators
- College Finance
- Community
- Credit
- Deal
- Debt
- Economizer
- Fraud
- Insurance
- Loans
- Mortgages
- Recalls
- Recession
- Retirement
- Saving
- Simplification
- Specials
- Taxes
FROM THE BLOG
- Ask WalletPop
- Consumer Complaints
- Daily Deal
- Fantastic Freebies
- Kids and Money
- Relationships
- Ripoffs and Scams
- Sex Sells
- Simplification
- The Dolans
INVESTING
- Stock Quotes
- Stock Charts
- Stock Ticker
- Portfolio
- Stock Screener
- Broker Center
- Mutual Fund Center
- ETF Center
- Money
- 24/7 Wall St.
SMALL BUSINESS
Foreign & Sector Funds
Foreign and sector funds can help you to diversify your investment portfolio.
Diversification is a basic investing principle that is based on avoiding putting all your eggs in one basket. If you invest in different assets whose investment returns are not correlated you will reduce the risk in your portfolio.
To the extent that foreign and sector funds help you to diversify your portfolio, you may wish to add them to your range of investment choices.
Foreign funds invest in the stocks and bonds of non-U.S. companies. Foreign funds are also called international funds. Global funds, on the other hand, invest in securities of non-U.S. and U.S. companies.
As a result, when a global fund manager turns bearish on investment opportunities outside of the U.S., they are likely to increase their allocation to U.S.-denominated investments. If your intent is to invest in companies outside of the U.S., you may wish to avoid global funds in favor of foreign funds.
Other foreign fund categories include regional and country funds. These funds further concentrate their investments to a particular region or country.
When you buy shares of a foreign fund, you also buy the currencies in which those countries operate. If your fund hedges its currency exposure, you may lose a few basis points in return for hedging costs but in exchange your portfolio is protected from fluctuating currency values.
If your fund does not hedge its foreign exposure, the fund's returns are likely to experience more volatility in returns.
Sector funds concentrate their investments in one sector of the economy. Financial services, utilities, technology and energy funds are examples of sector funds. After the technology stock bubble burst in early 2000 -- the tech-heavy NASDAQ stock index subsequently fell 80% from its high, dashing the optimism of millions of investors -- it's clear that concentrating in a single sector is bad for the value of your investment portfolio.
2008-07-21 14:38:08
Banking Basics
There are many types of bank accounts and services. Learn more about them here.
- Bank Accounts 101
- Bank Insurance and Regulations
- Electronic Funds Transfer
- Financial Supermarkets
- Money Market Funds
- Bank Accounts Aggregation
- Retirement Accounts
- Pay & Receive Bills Online
- Having a Brokerage Account at Your Bank
- Banks From the Blog
-
Latest Deals From The Web
Banking Tools
Use these bank account calculators and tools to help you make the smartest bank account moves.
- Check Latest Bank Rates in Your Area
- Safe & Sound (R) Bank Safety Ratings
- Establish a Target Savings Goal
- How Long Will Your Savings Last?
- CD Interest Calculator
- CD Laddering Tool
- See All Calculators
- -----------------------------------------
Interest Rates
| Type | Current | APR |
|---|---|---|
| 1 Yr CD | 3.65% | 3.72% |
| 3 Month $25K CD | 2.99% | 3.03% |
| 5 Yr CD | 4.14% | 4.22% |
| 6 Month $25K CD | 3.37% | 3.42% |
| 6 Month $50K CD | 3.43% | 3.49% |
This is from partner 1.
first partnerLet's Talk Banking
AOL members talk about personal bank account issues, banks you love or hate, where to find the lowest bank rates and more.