| Finding the best no load mutual funds is | | | | evaluating a fund's manager and |
| no easy task because today's top funds | | | | investment team. Portfolio managers |
| often become tomorrow's worst performing | | | | should have experience in a variety of |
| funds and vice versa. As the saying | | | | different market environments. The more |
| goes, "the faster they go up, the faster | | | | experience, the better, provided that |
| they come down." The temptation for the | | | | the portfolio manager is not close to |
| average person to invest in this year's | | | | retirement. In addition, the manager and |
| best performing funds is almost | | | | his or her team should have high quality |
| overwhelming. Unfortunately, investors | | | | educational backgrounds and/or |
| all too often focus solely on historical | | | | well-regarded designations. It has been |
| performance without considering how the | | | | my experience that managers with better |
| fund achieved the superior results or | | | | credentials are more successful than |
| whether the results are sustainable. | | | | managers with lesser credentials. |
| Mutual Fund Research | | | | Further, managers with high quality |
| The better way to perform mutual fund | | | | backgrounds seem to have better mutual |
| research is to focus on factors that | | | | fund research staffs than |
| will stand the test of time such as fund | | | | lesser-qualified managers. |
| expenses as well as the experience of | | | | Investment Approach |
| the fund manager and the depth of his or | | | | You should also probably consider a |
| her research team. Expense ratios, which | | | | fund's investment style and whether it |
| are generally comprised of an investment | | | | changes over time. The better funds |
| management fee, a 12b-1 fee and other | | | | employ very consistent investment |
| operating costs, do not typically | | | | approaches that rarely deviate from |
| deteriorate over time. Further, expenses | | | | their stated policies. At the very |
| vary considerably and can sometimes help | | | | least, if you are invested with a fund |
| explain the performance differential | | | | with a consistent approach, you will |
| between the best no load mutual funds | | | | know what to expect in both good and bad |
| and the worst no load mutual funds over | | | | markets. |
| time. This is especially true for | | | | Avoid the Media Darlings and Do Your |
| fixed-income funds, where sometimes only | | | | Research |
| one or two percent separates the best | | | | Investors should try to avoid the |
| from the worst funds. | | | | high-flying, top performing funds that |
| Portfolio Manager and Analyst | | | | often get quite a bit of media |
| Qualifications | | | | attention, but inevitably can never live |
| Even more important to selecting funds | | | | up to expectations. Instead, investors |
| that will be the best performers for | | | | should go the extra mile and delve into |
| years to come is the background and | | | | the world of mutual fund research. |
| experience of the manager and his or her | | | | Mutual fund investing can prove to be a |
| investment team. As the publisher of a | | | | very lucrative endeavor, but usually |
| mutual fund report, one of the most time | | | | only when you do the necessary legwork. |
| consuming aspects of my research is | | | | |