For many, that insane level of stress is best left to the pros. A host of Internet plays such as Yahoo Inc., Excite Inc. and Ebay Inc. have gone through similar gyrations. The sector, which rebounded from the Asian crisis last year, will likely also offer some shelter if things deteriorate in Latin America this year. The diversified nature of a fund softens the jagged edges on the chart a bit. He adds that many investors don't have the time to research individual companies and stay on top of developments.
Most individuals have pretty limited access to any meaningful information.
Mr. Brewster points out that diversification can seem to work against investors because a few flame-outs always drag down the overall return. So, while the returns were strong, the funds lagged far behind the best-performing stocks. Still, funds allow individual investors the luxury of time. A fund that drops in one quarter may roar ahead the next. Unit holders should be prepared to wait out the downturns, he says.