No one wants to waste money. Research the mutual fund performance of any fund you are considering
Become familiar with the main two measures of performance:
1. Best Performing Mutual Funds
2. Mutual Fund Returns
The SEC requires every fund to publish a prospectus and update it annually. Each fund must tell you how much it has increased or decreased in value in each of the past 10 years (or for every year of its existence, if shorter). This is labeled in the prospectus as "performance" or as "annual total return."
When assessing mutual fund performance, you are looking for long term growth. As some investors say, any track record under 5 years is noise. Research how a fund has done over longer periods of time and try to compare it to its peers or an index that represents the type of asset class the fund is in. For example, it is not helpful to compare a government bond fund to the NASDAQ.
Check out the consistency of the fund's returns and not just its average. For example, some mutual funds do well the first several years, then start to slowly peter out, making the average return look better than it is.
There are several helpful online tools to help you research mutual fund performance. For example, the Morningstar website offers data and analysis on over 8500 mutual funds.
Sponsored Links
Related Resources
OxfordJournals.org: Mutual Fund Performance
About.com: Mutual Fund Performance
MorningStar: Mutual Fund Performance
Related Articles
Mutual Fund Comparison
Mutual Fund Rankings
Mutual Fund Return
News
Google News: Mutual Fund Performance
Videos
YouTube: Mutual Fund Performance
Blogs
FundMyMutualFund.com: Mutual Fund Performance
Books
Amazon.com: Mutual Fund Performance
