Thursday, April 21, 2016

Being smart with $$ - Beware the mutual fund ads boasting strong performance

"Awesome 1-year performance", boasts a mutual fund ad. But did they mention that several of their other mutual funds did not do so well, and that they even closed some funds for inferior performance?  If a company has enough funds, they are pretty likely to have at least a couple that are above average.  But knowing in advance which ones will be the winners is the hard part.  And funds often find it difficult to perform above average on a consistent basis.  So be careful not to be the investor who is always chasing last year's winners only to find that you own this year's losers.
- Larry Pike, CFA, Client Priority Financial Advisors LLC
- www.clientpriority.com

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