Low-Risk Funds for Nervous Investors

These three funds will keep you in the game but limit your losses should the bear market deepen.

If the continuing collapse of the economy and the stock market doesn't leave you apprehensive, you're probably popping some pretty potent anti-depressants. To cope with your anxiety, we suggest three funds that will allow you to reduce your risk without abandoning the market altogether. They're also ideal for investors who've been on the sidelines and are ready to stick a toe back into stocks.

But first a caveat: Two of the three funds performed miserably last year -- although not as miserably as Standard & Poor's 500-stock index, which plunged 37%.

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Steven Goldberg
Contributing Columnist, Kiplinger.com
Steve has been writing for Kiplinger's for more than 25 years. As an associate editor and then senior associate editor, he covered mutual funds for Kiplinger's Personal Finance magazine from 1994-2006. He also authored a book, But Which Mutual Funds? In 2006 he joined with Jerry Tweddell, one of his best sources on investing, to form Tweddell Goldberg Investment Management to manage money for individual investors. Steve continues to write a regular column for Kiplinger.com and enjoys hearing investing questions from readers. You can contact Steve at 301.650.6567 or sgoldberg@kiplinger.com.