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Today, I read an article from MS Money, which I set up last night to monitor and manage my cash flows.

It talks about diversifying a portfolio even with small amount of money. The main idea is buying ETFs which are:

Vanguard Total Stock Market VIPER (VTI, news, msgs), which tracks the Wilshire 5000, an index of approximately 6,500 U.S-based stocks. It’s like buying virtually the entire stock market. iShares MSCI-EAFE (EFA, news, msgs), which corresponds to the Morgan Stanley index of stocks trading in Europe, Australia and the Far East. iShares Lehman Aggregate Bond (AGG, news, msgs), which attempts to track the price and yield performance of the total U.S. investment grade bond market. iShares Dow Jones US Real Estate (IYR, news, msgs), which holds a basket of 75 real estate investment trusts (REITs) that represent that sector of the U.S. economy. iShares Dow Jones US Basic Materials (IYM, news, msgs), which includes stocks in the energy, basic materials and precious metals sectors. (Once your portfolio reaches a total value of at least $25,000 — and it will! — you’ll want to switch your commodity allocation to the PIMCO Commodity Real Return Strategy fund (PCRDX), which more accurately captures the returns of the commodity futures market than a collection of stocks can. The fund has a minimum initial investment of $2,500, which makes it impractical for smaller accounts.) To keep your expenses as small as possible, he recommends to use ShareBuilder.

Well, let’s start. I think that sooner would be better.