Released: October 05, 2008

The shrinking nest egg

Source: Hanah Choh (Free Registration)

Stash your 401(k) statements in the drawer.

The third quarter was one of bailouts, near-collapses and takeovers on Wall Street that left many mutual funds down in the dumps. Investors had few places to turn for safety. Even money-market mutual funds, considered a bedrock investment that is never supposed to lose money, fell victim to soured mortgage investments when the Reserve Primary Fund fell below $1 last month in what is commonly referred to as “breaking the buck.”

All of that left mutual-fund investors with losses in the third quarter. The average U.S. diversified equity fund lost 9.96 percent, bringing the decline to 18.98 percent this year, according to mutual-fund tracker Lipper Inc.

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