NEW YORK (CNN/Money) - I own the Janus Twenty and Janus Mercury funds in my IRA account. They've gone down considerably over the past three years. Should I hold onto them?

-- Gerri Moniz, West Greenwich, Rhode Island

There's no doubt both these funds have done a dramatic about-face from their glory days of the late 1990s. From the beginning of 1998 through the end of 1999, Janus Twenty gained a remarkable 186 percent, while Mercury did even better, returning 210 percent.

Investors who thought those gains were a prelude to the future got a rude shock, however, as Janus Twenty lost 64 percent over the subsequent three years, and Mercury slipped 62 percent.

As tough as those losses have been on investors, however, the showing of these funds during the bear market hasn't exactly been out of character. Make no mistake about it, these are high-octane large-cap growth funds.

Anytime a fund can outperform the broad market like these two did during the bull market, it stands to reason that they're going to underperform during a bear.

The same goes as far as how these funds stack up to their peers in the large-growth category. In the late 1990s, when growth stocks were in favor and taking big risks paid off, these funds were at the very top of their large-growth category.

But when the investing environment turned against big-cap growth stocks, these funds tumbled dramatically relative to their peers. You can see all this by quickly scanning the Morningstar Quicktake Reports on Twenty and Mercury.

So, should you replace them? On the basis of performance alone, I don't see any reason to. They've behaved pretty much the way one would expect.

If you're looking for funds that might be able to ride the market when investors are ready to pour money into growth stocks again (whenever that may be), I think these funds would be decent choices, as long as you realize the risks they come with.

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One caveat: Warren Lammert, the manager who ran Mercury during its glory years, stepped down in February and the fund is now being managed by David Corkins, manager of Janus Growth and Income.

The fund is supposed to maintain its aggressive style. But whenever there's a manager switch, it's always a good idea to monitor the fund's investing style and performance.

But there's another issue you should consider here -- namely, how these funds fit into the rest of your portfolio. Do you own other stock and bond funds in your IRA, not to mention other investment accounts? Or do these two funds represent all or the bulk of your holdings? If so, then I'd say you're dangerously underdiversified.

Ideally, you want funds that complement each other and that give you exposure to different parts of the market. These funds are too similar to each other to provide any meaningful diversification. You're getting large-cap growth stocks and that's it. Virtually no small-cap exposure or value-oriented stocks.

What's more, both these funds are run in a very aggressive style. To me that means you've got a lot of overlap. On that basis alone, I'd argue that you don't need both these funds.

To get a good overview of what your portfolio looks like in terms of growth vs. value, the various sectors of the market that are represented and the types of stocks you actually own -- cyclical, aggressive growth, speculative growth, etc. -- go to the Morningstar Portfolio X-ray in the Investment Tools section of T. Rowe Price's Web site and plug in Janus Twenty and Mercury and any other investments you own. You'll get a statistical portrait of your portfolio overall.

Which of the two would I be more inclined to keep? If I were to go with just one, I'd be more inclined to choose Mercury, for the simple reason that it tends to spread its assets among more stocks than Janus Twenty.

According to the latest Morningstar Quicktake report for both funds, Mercury had 63 stocks in its portfolio and its top 10 holdings accounted for 34 percent of assets. Janus Twenty, meanwhile, owned 25 stocks (despite its name) and its top 10 holdings represented 56 percent of assets.

That's not to say that Mercury is going to hold up a whole lot better in a market downturn. Indeed, both funds were down by roughly the same amount in 2000 through 2002.

But if there's a problem with an individual company, say, an Enron-type meltdown, it's likely to have a much bigger effect on Twenty's portfolio than Mercury's.

I'll leave you with one final thought. I think every portfolio should have some core stock holdings. These can be individual stocks or a fund, but the core should be a well-diversified group of stocks that can provide long-term growth but that aren't so aggressive that you'll suffer massive losses during a downturn. In my opinion, neither of these funds qualifies as a core holding.

So if you don't already have other less aggressive stock funds in your portfolio to balance these volatile funds, I recommend you consider adding some, and making those funds the centerpiece of your holdings.

Walter Updegrave is a senior editor at MONEY Magazine and is the author of "Investing for the Financially Challenged." He can be seen regularly Monday mornings at 7:40 am on CNNfn.