T. Rowe Price Chief Urges Investors To Stay Diversified

by Philip Morton, Investors Offshore.com

12 October 2001

The Chairman of leading US investment management firm, T. Rowe Price, advised investors on Wednesday to keep their portfolios diversified, and predicted that there may be a rebound in early 2002, despite recent events.

Speaking to CNN Money, George Roche admitted that there had been modest redemption activity from mutual fund investors, but said that he didn't feel that the tragedies in New York and Washington had totally altered the fund investing landscape, as the economy was teetering on the brink of a recession before then.

When asked how he thought investors should proceed in these uncertain times, Mr Roche stressed the importance of diversity and long term planning: 'If you diversify and have a long-term strategy, then yes, you will be hurt in periods like this, but you will get through it and that's the desirable way to go,' he said.

The fund group chief then had a brave prediction to make about when things would start to look up for the American markets, suggesting that things would begin to pick up in the first quarter of next year, and would greatly improve by the second quarter. 'I think that the Fed policy will begin to work, and you'll also have some stimulus in fiscal policy as well, so you'll have both monetary and fiscal policy working,' he explained.

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