Specialized mutual funds can provide ongoing exposure to the technology sector. Technology spending
probably will grow faster than growth in the economy, long-term, which likely will help technology
stocks. Some level of exposure may be appropriate for investors with time horizons of 10, 15 years or
longer.
Aggressive investors might want to hold 5 percent-10 percent of their portfolio in a proven tech fund
such as Icon Information Technology Fund or North Track PSE Tech 100 Index Fund. Dollar-cost averaging
is a good strategy for investors eyeing such funds. With this approach, equal amounts are invested
each month or each quarter, allowing investors to catch periodic lows as well as highs.
Short-term, there are no major drivers of demand for technology such as the introduction of the
Internet or Y2K. Nevertheless, there are lots of technology areas that may not be earthshaking but
will grow significantly, such as wireless data, VOIP Internet phone service, and household broadband
service. Altogether, corporate budgets for Information Technology should be up around 3 percent-5
percent in 2005 and technology funds may perform well if those expectations are met.
