Investment question

[BLZrizz]

I have some spare cash lying around. I don't want to put it in any of the tax advantaged retirement options (401k, roths, etc) because I am planning to use the money to buy a home two to five years from now. Right now I have about 60% of it in a 5.25% savings account and the rest in a bunch of mutual funds. I add about $2,000 in that same allocation each month out of my salary.

Any suggestions? I'd like to grow it faster than 5.25% but I'd like to preserve as much of the capital as possible. As I stated above, my investment horizon is about 2-5 years. Would it be a bad idea to open a $10,000 position in a healthcare targeted fund to get in on the coming baby boomer...boom in healthcare services?

[Kuyuk]

The more money you have, the more you can haggle % on CD's and crap from banks.


2-5 years isnt long enough on baby boomer people's healthcare to pay off I dont think.

I'm just a noob.

K.

[Ignot]

Not the best way to get financial advise. You want growth and keep things safe. Well that is tricky. 2 years is a big difference from 5 years. If you really plan on buying a home in 2 years you should have very little in the stock market. 5 years however gives you some breathing room.

You could make a mit. Works best with at least five years and your gauranted to keep your principal no matter what happens in the market.

lets say you have 100k right now. Go out and buy a five year 0 coupon bond. Maybe you spend 80k on it. Then take the other 20k and put it into whatever you want. Like the Ishares S&P 500 index or something. You will get the growth of the S&P but you cannot lose your initial 100k with the 0 coupon maturing even if the market crashes. Limited downside, unlimited upside.

That being said, you should consider modern portfolio theory and avoid putting lots of money in 1 stock or 1 sector, even though I feel the healthcare sector will do will with a US economic slowdown.

Honestly, you should probably keep it safe but if you are heart set on making more money and willing to take risk then i would go with an opened end balanced mutual fund. flexibile enough to make changes if you need to and get out after 1 year. Mix of stocks and bonds.

A global flex fund would be good right now focusing on the international/global markets. You can even use yahoo finance to look some up. Blackrock has an awesome global flex. Go with the C shares.

a 5.25% savings is pretty good and you can sleep at night. I hope this is somewhat helpful and i know its kind of vague.

[BLZrizz]

I'm not looking for advice. I'm looking for suggestions. That said, keep it coming.

[TheEschaton]

lets say you have 100k right now. Go out and buy a five year 0 coupon bond. Maybe you spend 80k on it. Then take the other 20k and put it into whatever you want. Like the Ishares S&P 500 index or something. You will get the growth of the S&P but you cannot lose your initial 100k with the 0 coupon maturing even if the market crashes. Limited downside, unlimited upside.

Or the Ishares emerging markets fund, if you want a little more risk. Don't know how the S&P is holding up, but EEM has been up somewhere around ~30% for me over the past 9 months, even with the market sell off in China in Feb.

-TheE-