As far as I'm concerned, the real key is buying stocks that can grow their earnings faster than the typical firm. Since share prices pretty much track earnings over long periods of time, if you buy stocks with high growth rates and you don't overpay, odds are that you'll match or even slightly outpace the overall stock market. You basically want to try to buy stocks that are maybe in six or eight different industries and certainly technology is one. Drugs are probably another. And you might also want to have a bank stock or something in media or consumer products, or even in energy.
People talk so much about timing the market.
If you focus on the big growth stocks that I've been talking about, it's a pretty good bet that they'll rebound from any temporary setbacks. So I generally look for buying opportunities. That happened with healthcare stocks in the early '90's, energy stocks in the late '90's, and right now tech stocks look pretty depressed. You know, I think it's a mistake to switch money around too much in a retirement account. The best thing to do is decide how you want to split up your money and then stick with that allocation.