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Jeff Blades, 45

Started investing: 1989.
Focus: Mutual funds.
What stands out: A portfolio that grows steadily, without big fits and starts.
His advice: Invest in top-flight funds, keep tabs on the manager and performance, then let it be.

The Iron Distance triathlon is the ultimate test of endurance. This grueling race includes a 2.4-mile swim, a 112-mile bicycle race and a 26.2-mile marathon -- back to back to back. "It's all about pacing," says Jeff Blades, a St. Louis resident who has signed up for seven triathlons this year. "Simply put, short-term thinkers do not survive."

Blades, who works at IBM, applies the same rigid discipline to investing. Although he admits to dabbling in stocks, the self-described "mutual fund zealot" says he prefers to leave stock picking to the experts. "When I own a company's stock, I feel compelled to follow the company every day," he says. "But if I buy a solid fund with a good track record, I can scrutinize it once a quarter and go about my life."

Blades's fund-picking criteria start with low annual expenses and no sales charge. Beyond that, he looks for reputable fund companies and managers with long tenures. Blades avoids overly large small-company funds because of concerns that asset bloat can hamper a manager's ability to buy and sell thinly traded stocks.

The funds that help Blades sleep at night include Vanguard 500 Index and Vanguard Health Care, which happens to be the top-performing fund of any kind over the past 20 years. He is zealous about diversification, and he rebalances his portfolio annually to ensure that it does not become top-heavy with the best-performing categories. His top performers include Harbor International, which has a solid long-term record. A proprietary real estate fund within his IBM 401(k) plan and his own property holdings make up a little more than one-fourth of his investments. Blades figures that his investments have returned an annualized 15%.

His devotion to diversification helped him survive the dot-com crash earlier this decade relatively unscathed. At the height of the bubble, his portfolio was a modest 10% in tech stocks. "Tech was way overvalued," he says. "It was scaring me even when I was making money."

One remnant of tech mania, however, remains on Blades's fund roster: Jacob Internet fund, which is down an annualized 20% since the bubble burst in March 2000. "It's my single emotional buy and a reminder that emotion and money make very poor bedfellows," he says, and he means it. He's careful not to get carried away with company stock options and has only 4% of his portfolio in IBM stock. "I believe putting a significant percentage of assets in one stock is dangerous," he says.

His tenacity is paying off. This fall, Blades will compete in his 70th triathlon, and if the market performs reasonably well, his portfolio should hit seven digits.

--Katy Marquardt

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