| Whatever type of retirement fund you have, be | | | | fund companies, like Fidelity and Vanguard, are |
| it 401k 403b, Roth IRA or plain old IRA, you want | | | | now offering funds which has some hedging. |
| to spread your risk. | | | | What is hedging? Hedging is betting with some of |
| Stocks go up and go down. Treasuries and | | | | your money that the price will go down,and with |
| government backed bonds are very safe, but | | | | some that the price will go up. Of course, you put |
| they also go up and down in value, although you | | | | more money where you think the market is |
| will always get a reasonable return. You can lose | | | | going, and some against it. If the fund manager is |
| your shirt in futures and commodities. Gold is | | | | right, the value goes up, and he is wrong it goes |
| attractive, too. So what should you do? | | | | down a little. In the long run, a good manager, |
| Most people start off with investing in mutual | | | | with good investment tools and research, can |
| funds, or they rely on a professional adviser - by | | | | consistently make profits whatever the market |
| the way professional means that he gets paid for | | | | does. |
| doing that job, so don't assume a professional | | | | Therefore it is a good idea to have a small portion |
| adviser is an expert. Mutual funds generally invest | | | | of your retirement fund in a fund that is involved |
| in stocks, but it is certainly a good idea to have a | | | | in hedging in a conservative manner. This is a |
| proportion of your retirement fund invested in | | | | good way to get into commodities - any other |
| high-quality bonds - and the older you get the | | | | way is far too risky unless you have money to |
| higher the quality you need. | | | | throw away, and if you do, you won't be putting |
| Stocks can be risky | | | | it into a retirement fund. Investing in hedged funds |
| Recently, managers and investors alike have | | | | and commodities is not something to undertake |
| realised that markets do go up and go down, and | | | | on your own - you need to seek the advice of a |
| so they have sought to diversify out of stocks, | | | | good financial adviser. |
| or in some cases out of the USA. Diversifying | | | | Disclaimer |
| overseas is either risky - in new markets like | | | | The information on this web site does not |
| China and Korea - or is a currency play. Why? | | | | constitute an offer in any way. It gives general |
| because the leading markets in the USA, UK, | | | | information, but is not financial advice. The aim is |
| Europe and Japan tend to move in the same | | | | to help you decide what to do about your |
| cycles - and it is long term cycles that you need | | | | retirement plan, and the importance of saving for |
| to watch for your retirement fund. | | | | retirement. You should consult a retirement |
| Hedging helps | | | | planning adviser with a proven record before |
| An alternative is a hedge fund. But these are | | | | setting up a retirement plan. |
| very risky. However, some of the leading mutual | | | | |