Market Valuation Risk - Some companies that are growing very fast have unreasonable valuations by traditional valuation techniques. Since these companies stock prices do not reflect the usual relationships between price and corporate earnings or income, their stocks tend to be extraordinarily volatile and speculative. The Fund will invest in these companies, many of which are technology companies. The Fund may invest in the common stocks of relatively new companies, which are making initial public offerings or are in operation for less than three years. These stocks are generally more risky than the stocks of established companies.
New companies have a higher failure rate.
They may lack the resources and funds necessary to grow and establish themselves in the marketplace. These companies may also focus on products or services with no established markets, and they may fail to establish a market for their products or services. Small Company Risk - Stocks of smaller companies may have more risks than those of larger companies. In general, they have less experienced management teams, serve smaller markets, and find it more difficult to obtain financing for growth or potential development than larger companies. This means that a large loss in an individual stock may cause a much larger loss in a non-diversified fund s value than it would in other funds.