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Strategies & Market Trends : Fidelity Select Sector funds -- Ignore unavailable to you. Want to Upgrade?

To: Julius Wong who wrote (1308)	12/6/1998 12:43:00 AM
From: Jim Battaglia	Read Replies (1) \| Respond to of 4916

We are in December now. Is tax loss selling ahead? Yes, no doubt. But we need to remember that Dec can also be a profitable month. Read what Fabian reports on December's activity: TIS THE SEASON TO BE CHOOSY Many investors get ultra-conservative about adding funds to their portfolio in December. Some refuse to take part in the stock market at all. Why the bah-humbug hesitancy? Typically, advisers and mutual fund participants shy away from the tax liability associated with capital gains distributions. Is there a risk of being out of the market? Definitely. According to Yale Hirsch of the Stock Trader's Almanac, December is the best investment month on record with a "Santa Claus Rally" in 35 of the last 45 years (1.5% S&P gain). Essentially, waiting to invest until after a distribution may result in lost opportunity should stocks gain the ground necessary to outpace any tax savings. Of course, capital gains distributions are not a concern for your tax- deferred accounts. Since we are experiencing a solid uptrend at this time, you should definitely continue making your IRA and 401(k) contributions. But how can you capitalize on December gains in your taxable portfolio? Get selective. Consider index funds such as Schwab 1000 and Schwab S&P 500 Index Fund; historically, neither of these vehicles have declared any distributions. Choose funds that boast impressive 4, 8 and 12 week percentage gains, but may have declared distributions early this year. I've been hot on Oakmark Fund and Fidelity Dividend Growth, both of which already had distributions this past summer. While Dividend Growth estimates a 32 cent per share distribution on December 14, this is significantly smaller than the average fund and significantly less than last year's 93 cent per share. When you consider its 8-week take of 17.81% and year-to- date cache of 28.65%, FDGFX, may be an ideal pick. But don't get snagged in the chimney. Call the 800 number of fund families and ask the "when" and "how much" questions on distributions. If they want your business, they'll be as helpful as possible. With the Bull's forceful return to domestic equities, you absolutely need to participate. That means being choosy and selecting the apropriate funds for your financial future. " Jim investnbest.netmegs.com