Investing in any of the three conglomerates over GE would have been a wise decision over the past three years. United Technologies and 3M gained about 20%, while Danaher climbed 7%. In contrast, GE lost 47% of its value, dragged down by the finance unit, a business that should never have gotten so big.

Conglomerates carry unique strategic risks, as overzealous executives build empires and, thus, take on too much. United Technologies has remained within its abilities, so it offers investors exposure to equity markets with more stable prospects.

-- Reported by David MacDougall in Boston.
Prior to joining Ratings, David MacDougall was an analyst at Cambridge Associates, an investment consulting firm, where he worked with private equity and venture capital funds. He graduated cum laude from Northeastern University with a bachelor's degree in finance and is a Level III CFA candidate.

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