Successful Investing Starts With Saving

Four No-Load Funds to Consider

Many mutual funds, which provide the diversification you want, don't make the cut on costs. Certainly none with sales commissions do. Paying 5.75% in commissions on your new investment every month sure will slow down the growth of your investment -- and reduce your incentive to keep on saving.

The few no-load funds with performance histories that I like all require $2,500 minimum investments. If you can afford to jump-start your saving-investment account with $2,500 to get over the initial minimum investment, they're a solid choice.

On the bond side, (BEGBX)American Century International Bond Fund doesn't charge a commission and has a low 0.84% annual expense ratio. You'll need $2,500 as an initial investment, but the minimum additional investment is just $50. (DODIX)Dodge & Cox Income also charges no commission and has an even lower 0.45% annual expense ratio. The minimum initial investment is again $2,500, and the minimum additional investment is $100. Morningstar gives these funds ratings of four and five stars, respectively.

On the stock side, (DODFX)Dodge & Cox International Stock has no commission charge and a low 0.82% expense ratio. The minimum initial investment is $2,500, and the minimum additional investment is $100. (FEXPX)Fidelity Export and Multinational is commission-free and carries a low 0.84% expense ratio. Minimum initial investment is $2,500, and the minimum additional investment is $250. Morningstar rates both funds with five stars.

If you can't rustle up that $2,500 minimum investment, I'd suggest combining the two alternatives by using ShareBuilder for your initial savings-investment vehicle and then shifting over to one of these mutual funds when you've built up the minimum. That way, you'll only pay that flat $4 (but 5%) commission on new-money buys for two years or so.

Of course, you could simply find more savings annuities. That would drive the cost of using ShareBuilder.com down, too.

Changes to Jubak's Picks

Sell Marvell Technology Group. I think it's time to give shares of Marvell Technology (MRVL) a rest. Wall Street looks like it's starting to discount the relatively slow earnings growth it's projecting for the company in the first half of 2005. For example, on Nov. 18, Marvell Technology Group reported earnings of 22 cents a share, a penny ahead of the Wall Street consensus. But although several analysts raised their earnings projections for the quarters ahead, none that I've been able to find raised their price targets. Wedbush Morgan, in fact, downgraded the shares from buy to hold.

I'm going to take my profits here and wait for the usual Wall Street overreaction if earnings growth does indeed drop, as Wall Street now projects, to 23% in the fiscal year that begins in January 2005 from the 72% projected for the fiscal year about to be concluded. I have a 30% gain in Marvell Technology Group since adding these shares to Jubak's Picks at $25.99 on June 29, 2004. (Full disclosure: I will sell my shares of Marvell Technology Group on Dec. 10.)

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