`Diversify' Is Still The Money Managers' Mantra

After the big U.S. runup in '95, foreign markets may lead in '96

Global investors got a rude shock in 1995. The popular wisdom--that diversifying their assets around the world would maximize opportunities while reducing risk--didn't work. Instead, investors who sank all of their savings into a mutual fund indexed to the Standard & Poor's 500-stock index earned 33%, compared with an average 12.5% for sophisticates who put their money in funds composed of international stocks and bonds.

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