The one thing a mutual fund, if it is noload, does, is you can put
small amounts of money in each month, and there is no transaction fee.

If you have a lump sum there are many options. The most obvious is
Exchange Traded Funds.

You can create your own "stock fund" or pay a broker to put you in a
stock basket. The DOW 30, has 30 stocks and they change components at
less than one stock per year (average). So for an initial fee of (30 x
$20/trade) of $600 you could create this Personal Dow Mutual Fund and
annual fees would be $40. If you had $60,000, this would be an annual
expense ratio of less than 0.1% (one tenth of a percent per year).
Over 10 years, if you ammortize the initial broker fees, it would be
approximately 0.2% per year. The DOW has done about the same as the
SP500 or Total Stock Market over the years (a remarkable achievement).
You would have to be savy enough to somehow notice or get notified of
component changes in the DOW, so the thing is not as trouble free as a
Mutual Fund. Also, you are going to have dividend distributions, and
there is no "automatic reinvestment" of those with stock baskets (that
I know of anyway).

Personally I like Mutual Funds, but only no load ones, and even then
only the low cost no loads. If you are going to bother with stocks,
you might as well really get into it and learn how to buy and sell to
manage your tax losses, as this will benefit you some.

In article <089ub.6511$%51.31764551[at]newssvr21.news.prodigy.com> , Tad Borek wrote:
- quote -

The idea that you can trust an investment bank to tell you which
stocks to buy is hilarious. They have no incentive to do a good
job. If they could do a good job they would not publicize their findings.

i

In article <3FB58FE4.E7961964[at]rmi.net.N0SPAM> , Reed wrote:
- quote -

Hold on. Not all mutual funds are corrupt. Vanguard funds are managed
by an honest company. I have not seen them do anything that would even
raise my eyebrow. I expect them not to do anything unethical in the
foreseeable future. John Bogle is a real man, not a greedy thief. I
have one of my IRAs at Vanguard, and a money market account. Another
one is at my online broker.

As a disclosure though, my Vanguard IRA is in their brokerage account
and is 97+% in a single stock. When I set it up, I wanted it to stay
untouched for many years for certain reasons.

i

There is an approach called Seperate Accounts where a broker will
select a portfolio of individual stocks and hold them in your name.
There is no joint ownership so you are not affected by what other
people do.

You are counting on the broker to pick the right stocks and maintain
the portfolio in your best interest.

Frank

Reed <reedh[at]rmi.net.N0SPAM> wrote in message news:<3FB58FE4.E7961964[at]rmi.net.N0SPAM> ...
- quote -

On Mon, 17 Nov 2003 13:09:50 CST, Tad Borek <borekfm[at]pacbell.netwrote:


- quote -

Agree that Vanguard is unlikely to be tarnished. Others in that group
should be T. Rowe Price and TIAA-CREF. I expect that they will
benefit at the expense of others.

Saw an article in this morning's paper about investigations spreading
into Variable Annuities. No specific insurance companies mentioned.

As is always the case, the best defense is to stick with companies who
have conservative, investor-friendly cultures.

-HW "Skip" Weldon
Columbia, SC

Brent D. Gardner, ChFC wrote:
- quote -

There seems to be a sea change going on at Schwab. Did you see the
Investment News headline, "Schwab pumps up sales side, readies its
troops to combat wirehouses"? Plus fee changes and that stock rating
system...they're starting to look more like another wirehouse.

Speaking of the stock rating system, this contrarian couldn't help but
laugh at the results published recently. They grade every stock A to F,
and here were the results - to quote from the SF Chronicle 11/13/03:

"From May 6, 2002 through Oct. 20, 2003, Schwab's F-rated stocks
have done the best, with an average return of 30.09 percent. The D-rated
stocks were second best, with a 25.4 percent increase. Stocks rated C
and B were next, with an identical 23.3 percent average increase. In
last place were the A stocks, which rose 22.4 percent."

Almost good enough to be a short-selling strategy.

-Tad

Reed wrote:
- quote -

Careful you don't throw out the baby with the bathwater, or you won't
have anywhere to invest your money. There really isn't any industry with
totally clean hands - S&Ls being an obvious example.

Certainly at the firms where the improprieties happened, it raises
questions about who's minding the store, and whose interests they have
in mind. But not all fund companies are implicated in the scandals. It
seems unlikely that Vanguard, for example, will come up because it isn't
a for-profit firm. In fact they've put things in place to discourage
some of the trades that have caused the problems (market timing).
Vanguard is owned by the shareholders of the funds, and lacks the fund
management structure (or make that, lack-of-management structure) of
those firms.

Who knows, something might come out about Vanguard as well but it seems
it would be more likely to be a trade error than one of the clearly
self-interested practices that a few firms were doing to boost profits,
or generate profits for a select group of shareholders. Vanguard doesn't
have any profits to boost so why would the empoloyees bother?

-Tad

Paying attention

"Reed" <reedh[at]rmi.net.N0SPAM> wrote in message
news:3FB58FE4.E7961964[at]rmi.net.N0SPAM...
- quote -

"Reed" <reedh[at]rmi.net.N0SPAM> wrote in message
news:3FB58FE4.E7961964[at]rmi.net.N0SPAM...
- quote -

Exchanged Traded Funds, Annuities (fixed, variable, indexed), REITs, Unit
Investment Trusts, Stocks, Bonds, Closed End Funds, Direct Participation
programs (LPs), Seperate Account Management, etc.

I would not bank on ANY name brands as being sin-free. Pandora's box has
been opened, and there will be more companies nailed. Plus, there will be
plenty who never get caught. Anyone that thinks any company has never done
what Putnam has is performing the Ostrich manuever. Even Schwab, the bastion
of No Help, has been exposed. That's a serious black eye on a firm that has
bragged so long about their lilly white reputation. Some funds may do a
better job policing themselves, but large fund megaplexes? Impossible. They
are all guilty to one extent or another. It is inevitable that more will get
caught.

I've been scaling back mutual funds from my practice for nearly four years
now. Unfortunately, under the mattress is not an option for your IRA, since
it has to be somewhere, unless you want to pay taxes, and maybe a penalty.
=)

I have met with clients who kept cash in bizarre places. One time they
brought in cash that had a lot of fresh dirt on it. They kept a strong box
buried behind the barn. Every year, I go see them to collect an insurance
premium, and every year they disappear for a few minutes to go make a
withdrawal from the safest bank they know.

Brent D. Gardner, ChFC
Chartered Financial Consultant
http://members.cox.net/brentdgardner1378/

"Be ever questioning. Ignorance is not bliss. It is oblivion. You don't go
to heaven if you die dumb. Become better informed. Learn from other's
mistakes. You could not live long enough to make them all yourself." - Hyman
George Rickover (1900-86), Admiral, US Navy, advocated development of
nuclear subs & ships

"Reed" <reedh[at]rmi.net.N0SPAM> wrote in message
news:3FB58FE4.E7961964[at]rmi.net.N0SPAM...
- quote -

Will you be satisfied with bank rates? Some banks have mutual funds as well,
but they have relatively high fees. Has your mutual fund company of
preference been named in the improprieties? There are more mutual funds than
there are publicly traded companies and lots of mutual fund companies. There
are a couple of large no load companies whose reputation is untarnished
(Vanguard and Fidelity), as well as many other companies operating in an
ethical manner. Do a little research, I'm sure you can find a company with
which you can feel comfortable.

Elizabeth Richardson

Given the recent (and on-going) revelations re the mutual fund
industry, what is the next best alternative for Rollover IRA
accounts ??

Banks, S&Ls, under the mattress ??

--reed