CHICAGO, Sept. 20, 2002 (PRIMEZONE) -- Ibbotson Associates today announced the results of a study that validates the benefits of incorporating sector funds into an investment portfolio. The quantitative study, sponsored by INVESCO Funds Group, revealed that over a broad range of risk tolerances, portfolios with sector components could deliver superior expected performance.
According to Peng Chen, Ibbotson Vice President of Research: "Introducing industry sectors can enhance the risk-return tradeoff of a portfolio. Sectors can simply be added to a portfolio or used to construct the entire equity portion of a portfolio with moderate-to-aggressive investment objectives."
The study focused on the diversification benefits that sector allocations bring to long-term investors' portfolios. Concentrating on the sectors of energy, financial services, utilities, technology, health care, telecommunications, leisure and real estate, Ibbotson found that for equity investors, sectors offer the potential for higher than average returns, and a more simplified and diversified way to participate in a particular market sector or industry than choosing individual stocks. Sectors also provide portfolio diversification due to their low correlation with each other and with the overall market.
"We are delighted that Ibbotson's research confirms that sectors can enhance a portfolio. The inclusion of various sector funds in a portfolio can be an important tool and is often overlooked for the wrong reasons," said Tom Kolbe, National Sales Manager for INVESCO Funds Group. "Now Ibbotson, a respected and independent organization, concludes what we have been advocating. Sector funds offer an attractive way to target some exciting investment opportunities and improve diversification within most portfolio objectives."
About Ibbotson Associates
Ibbotson Associates, founded by Professor Roger Ibbotson in 1977, is a leading authority on asset allocation, providing products and services to help investment professionals obtain, manage and retain assets.
The company's business lines include investment consulting and research; planning and analysis software; wealth forecasting; educational services and a widely used line of NASD-reviewed presentation materials. With offices in Chicago, New York and Tokyo, Ibbotson Associates provides integrated investment knowledge, leading-edge technology, multi-conceptual education and a variety of sales presentation solutions. Ibbotson markets its integrated product line of investment analytical tools and services to institutional money managers, plan sponsors and consultants for quantitative analysis, high level decision making and presentations. The company's clients also include financial planners, brokers, mutual fund firms, private bankers and small money managers.
About INVESCO Funds Group
Denver-based INVESCO Funds Group, a subsidiary of AMVESCAP PLC, has $26 billion in assets under management (as of 6/30/2002), and is one of the premier mutual fund management companies in the United States. INVESCO provides a wide and innovative range of investment products and services to individuals and institutions. AMVESCAP, with $364 billion in assets under management (as of 6/30/2002), is one of the world's largest independent investment managers, operating under the AIM, INVESCO and Atlantic Trust brand names. The Company is listed with the symbol "AVZ" on the London, New York, Paris and Toronto Stock Exchanges.