How do YOU pick your funds?

Discussion in 'Finance, Investing & Economy' started by Txtriathlete, Jul 9, 2005.

  1. Txtriathlete

    Txtriathlete Super Moderator
    Staff Member

    Aug 6, 2004
    The American Empire
    I want to know how others pick their funds and what they place as a priority, management tenure?
    Load type?
    Expense ratio?
    Perhaps past performance?
    What do you think is more important along with any ideas or thoughts on whats best at this time?

    Thanks in advance for your thoughts.
     
  2. Achtung

    Achtung Member

    Jul 19, 2002
    Chicago
    Club:
    Manchester United FC
    Nat'l Team:
    United States
    Definitely go with no-load funds (most of which perform at least as well as their load counterparts). In general, unless you're planning to actively track fund performance, going with an index find is probably your best bet. If you're going for something more aggressive (managed funds), take a look at both past performance as well as the tenure of the fund manager. Low turnover within the fund is another good indicator.
     
  3. GoldFinger

    GoldFinger New Member

    Jun 19, 2004

    You're right on. I would add that expense ratio is important. High costs, just zap away at your total return.

    Check out Vanguard or T.Rowe Price.
     
  4. yimmy

    yimmy Moderator

    Aug 23, 2004
    California
    Consumer Reports actually studies and evaluates mutual funds and recommends a few certain funds. I wish I could find that article....
     
  5. bigredfutbol

    bigredfutbol Moderator
    Staff Member

    Sep 5, 2000
    Woodbridge, VA
    Club:
    DC United
    Nat'l Team:
    United States
    I found several articles from CR on the Gale Database. Most public libraries should be able to find something--for copyright and access reasons, I can't give a link here. But check out March 2005, Vol. 70, Issue, 3 p. 28.
     
  6. B Rock

    B Rock Member

    Oct 7, 2004
    I'd like to add a quick addendum to this. Obviously energy and housing stocks have been the market leaders for the first 2Qs of 2005; and thus mutual funds heavy in those stocks will show the best performance recently.

    What you have to weight is what sectors you feel confident in and pick a fund that corresponds to them. If you pick one of the top performing funds from the 1st half of 2005 and oil goes down to $50 (I know, not a chance) you'll take a massive hit as many of the stocks will likely move with it to a degree.

    Personally when I'm looking for a fund I look for a beat down sector (i.e. I went into a tech fund early 2Q this year) and find a fund that is heavily weighted in that sector.

    Actually ETFs are a better and more flexible way of doing this, but thats a whole other topic.

    I guess the moral is past performance can be decieving as it indicates many of the equities held have already experienced a healthy appreciation and will be more likely to face resistance moving forward.
     
  7. VFish

    VFish Member+

    Jan 7, 2001
    Atlanta, GA
    Club:
    Atlanta
    And for Index Funds you can't be Fidelity
     

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