[quote=scaredyclassic]
as to the mutual fund being smarter or beating the market, through trading or a sense of what’s coming, in general, they’re wrong. seems like ti would be better to just buy the same stocks as a fund you like and hold them. save the .3 or .5 % a year they charge to do the buying for you.[/quote]
Oh, I don’t know. In some ways you are right.
I’ll never forget the series of stories WSJ did in the 90s showing that throwing darts at a dartboard picked stocks as well as if not better than the pros.
However, I do have my money in a few mutual funds that do outrageously well over the long term, even after taking into account fees.
JPMorgan Large Cap Growth Fees: 1.04%
3yr: 27% 5yr: 25% 10yr: 17%
Now let’s look at what a low fee SP500 index fund returned:
Schwab S&P 500 Index Fund (SWPPX) Fees: 0.02%
3yr: 16% 5yr: 16% 10yr: 13%
So – if I’m getting a better return with managed funds AFTER they deduct their fees than I could get with the SP500 Index fund with almost no fees, why wouldn’t I buy the better managed funds?
