INVESTMENTS - SECTOR FUNDS
"This section
contains additional data that supplements basic information contained in
Your
Money Matters
and should be used
in conjunction with the material contained in Your
Money Matters."
There are two schools of thought about investing in sector funds. One says to put your money into the industrial sectors that are Wall Street darlings. This is the momentum approach, and in 1999, the technology and telecommunications sectors had the momentum. The other school of thought says “Wall Street be damned, wall flower sectors are the place to be.” Devotees of this approach look for sectors whose stocks have slumped where they can buy stocks on the cheap. Judging from last year’s sector fund performance (see below), wallflower proponents are probably attracted to the financial services and real estate sectors.
In addition to the 1999 average performance of the seven industrial
sectors with the most available sector mutual funds, you’ll the
relative rankings of various sub sectors within each sector as
evaluated by the Value Line Investment Survey in early January
2000. For example, in the technology sector, there are five
technology sub sectors that are monitored by Value Line and their
ranks in January 2000 for probable relative performance over the next
12 months range from 1st to 13th. There are 91 industries
ranked by Value Line at present. The purpose of this is to give
you a general idea of how the experts at Value Line feel about how
they think various industry segments are likely to perform.
(See related discussion on page 167 of Your Money Matters.
Rankings change, of course, so be sure to check current rankings by
referring the Value Line Mutual Fund Survey summary section.
Sector Fund Performance for 1999
|
Sector |
1999 Performance |
Value Line Investment Survey |
|
|
|
Industrial Sector Rankings 1/00 1 |
|
Technology |
+133% |
1,2,3,4,9,13 |
|
Telecommunications |
+76% |
6,17,21 |
|
Natural Resources |
+30% |
23,33,36,48,73 |
|
Health |
+17% |
16,35,38,69,72 |
|
Utility |
+15% |
73,87,88,89 |
|
Financial Services |
-1% |
11,15,20,50,51,59,63,68,91 |
|
Real Estate |
-3% |
79 |
1
Ranking of various industrial sub sectors
within broad sector for probable relative performance through January
2001out of 91 sub sectors.