SMI’s Fund Upgrading strategy diversifies your portfolio across five stock categories. Within each category, we recommend three fund options.
If you wish, you can invest in all three funds in each category. However, we assume that most of our members keep things simple by investing in only one fund in each category, and that’s fine.
With such an approach, you invest in the top-ranked mutual fund (or exchange-traded fund) in each category at the outset, and when it’s time for a fund you own to be replaced, you sell it and invest the proceeds in the fund that is top-ranked at that time. (The top-ranked fund is not necessarily the most recently recommended fund.)
Readers following our Upgrading recommendations naturally expect their results to be similar to those published in the newsletter. But there’s a rub. Our published results are necessarily based on all of our fund recommendations, which means the average of all three of the funds recommended in each risk category. In other words, you would need to own all 15 of the recommended stock funds listed on the Upgrading Recommendations page to get our published results. However, due to fund minimums and brokerage availability, that may not always be possible. Even if it were, owning that many funds requires more effort and a level of complexity that would not be welcomed by every reader.
So that raises the question: How would buying only the top-ranked funds impact your returns as opposed to owning all of the recommendations?
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