Large Us Stock Fp Israelsen Jan 2012

Large Cap US Equity

Craig L. Israelsen

Financial Planning Magazine

January 2012

A new year is upon us—and with it the opportunity to explore anew the virtues of building diversified, multi-asset portfolios that can provide growth during the pre-retirement accumulation years and durability during the post-retirement distribution years.  

The asset classes that belong in a diversified portfolio are listed below in “Asset of the Month--2012”.  As this is the January issue I will be exploring in detail the asset class of large cap US equity.  Next month I’ll explore mid cap US equity, in March small cap US equity, and so on throughout 2012.  By the end of the year, we will have completed an in-depth analysis of all 12 asset classes that comprise a diversified investment portfolio.

Asset of the Month--2012

Large Cap US Equity

This article examines large US equity.  The “base” asset in many portfolios is large cap US equity (“stock”).  Using Morningstar Principia as the source of data for this study, there were 754 large cap US equity funds in existence as of October 31, 2011.  This total included funds classified in the following Morningstar categories:  large cap value, large cap blend, large cap growth, communications, consumer cyclical, consumer defensive, equity energy, financial, health, industrials, natural resources, real estate,  technology, or utilities.  Additionally, to be included as “large cap US equity funds” each fund had to have less than 5% of their portfolio in bonds, non-US equity, or cash.  Only “distinct” funds were counted, meaning that only one share class of a fund was included for those funds that are offered in multiple share classes.