End of The Comfort Factor

Mutual funds provide a thin cushion against the crash

As long as Wall Street was blooming, mutual funds seemed to promise the impossible: a place where cautious people could plant their money, ignore it and let it grow, as safely as in a bank but as fruitfully as in the stock market. Millions of new investors could not resist. Take Charles Jayson. Last year the Manhattan retailing executive bought 510 shares in a stock fund managed by Boston's Fidelity Investments (total assets: $75 billion). "I wanted to be in the market," says Jayson, 30, "but I wanted something I didn't have to watch every day."

Still, he could not help...