Investment ideas question

[clh2]

I have a small amount of money in a Roth IRA that is in a "cash position" that really should be invested into something. The sole purpose of this Roth is for DD's College Fund. DD is 11. Other background info - this is a small piece of her college fund - I would not be doing this with her whole college fund. I think it would be a nice learning experience for her to help research companies, and pick one - and go for it.

My reason for posting is to get ideas of companies that impact kids - that might be good ones to start researching. My first thought was Disney stock, my second one was WalMart or Target- as she loves shopping there. Of course- she loves shopping anywhere.

I know it shouldn't be hard coming up with a list of companies we should start to look at - but I am having a brain freeze tonight. FWIW, she doesn't like McD's, and after watching SuperSize Me - I doubt she would want to support them anyway.

 

[Kermit]

How are you going to use a Roth for college? Will you be retirement age when she needs it?

I'd put the money in a good mutual fund with a proven track record. It's boring, but it's not nearly as risky. Investing in a single stock or even a few stocks isn't generally a good idea for the average investor. You don't know the in's and out's of the company you choose to invest in, and you won't be able to tell by reading the quarterly earnings report whether you should hold or buy.

 

[clh2]

We are using a Roth for part of this based on the logic described in:

read this about Roths and College

The benefit to us is - if she doesn't go to college - she doesn't get any of this money.

Kermit, the bulk of her college is in various mutual funds. That is not the question, nor do I want this to become a debate.

I was just looking for ideas on which companies might be good kid-related companies to look into.

 

[Papa Deuce]

I don't remember the name, but there is a mutual fund that specializes in "kid friendly" stocks. Ask your broker and do your homework.

 

[clh2]

Papa Duece Is that the Columbia Young Investors fund you are referring to? We know that one well. Really well. We knew that one when it was the Stein Roe Young Investors Fund. Heck - our financial advisor learned about that fund from us in 1994 after it inception. (I just wish I would have had more to invest back at that time...)

But - really, really, really, I am just looking for ideas on companies for an individual stock purchase. This is really just a tiny part of her entire college fund (i.e. less than 3%) that we are wanting to invest in a particular stock.

As I have said several times now - the decision to be made IS NOT to do or not to do a mutual fund, it is to look at particular companies, preferably companies that specialize in kid products, and work with DD to do the research, and then track it until it reaches a predetermined sell price.