Should I invest in more than one mutual fund?

Hi, I'm interested in investing in mutual fund from vanguard and was wondering if I should invest in more than one mutual fund. I've been reading up a lot about investing and need some opinions from users. I understand that diversification is the key, but does that includes mutual funds too or just stocks? because mutual funds already are a collection of various stocks and bonds. thanks in advance.

well, that depend on the type of mutual funds. if you select "Sector Fund" for example, you need to diversify in other funds in different sector too. because, sector fund tend only focus to specific economic sector, such as oil & gas, internet or automotive.

due to variety of types of mutual developed recently, i myself diversify my mutual funds collections.

I am a professional investment advisor. I have found that there is a recurring problem with the questions that are asked on this site. Not enough information is given by the asker to accurately answer the question. In your case I would need to know what Vanguard Fund you are looking at and also a little biography about yourself. Your age, goals etc.

What we can try if you seriously would like a professional answer would be for you to email or Yahoo Messenger me. Reask your question and answer mine. We could then have more meaningful dialog and help you more efficiently. It now becomes one on one personal help. You can now compare my answer to the other ones you got on Yahoo Answers and make the right decision.

By the way for the others of you who are reading this response you can email or Yahoo Messenger me with any comments or questions you have and we can also have private dialog.

My credentials as an advisor if you are interested are contained on my website which is www.themutualfundhelper.com. I am providing my website not as a sales-tool but simply as a vehicle to present my credentials.

Good points all, that you make. I am also in Vanguard, and I like to pick a couple of funds, place equal money in them and watch them "race". It's a safer version than betting on Barbaro, and I end up winning no matter what. I'm all in stocks, but still young. Everyone I talk to preaches DIVERSIFICATION! Yes, you are right that mutual funds are already diverse, but some are geared towards the tech sector, some more towards energy, etc. Get some prospectuses to make sure the companies in the fund fall "in line" with your investing style and comfort level.
Good Luck and Tallyho!

Yes.