I’m Keith DeGreen and this is your Investors Minute.
Actively-managed mutual funds are much more expensive than exchange-traded funds, or ETFs.
The additional cost could be a fair bargain if you find a mutual fund that consistently outperforms. But are there any such funds out there?
The short answer is, not really. Here’s the tally, according to the S&P Dow Jones Persistence Score Card through March 2014:
Five years ago, 715 mutual funds finished in the top quartile – the top 25% — of their peers in performance. By the end of the next year, only 23% of those funds were in the top quartile. Over three years, only 4% remained, and – believe it or not – only 2 of 715 funds finished in the top 25% over that five year period. That’s .28%!
FEE-ONLY DeGreen Capital Management. Pioneers in low-cost exchange-traded fund investing. Newport Beach: 949-333-3450. Scottsdale: 480-609-9900. www.DeGreen.com. Minimum portfolio requirement $500,000.
©DeGreen Capital Management LLC. All rights reserved.