Friday, June 17, 2011

50 Best Funds of the Worst Funds

The money section of U.S. News featured a list of 50 mutual funds which they claim are the best choice for the everyday investor (50 Best Funds for the Everyday Investor; U.S. News). It is hard to put more idiotic remarks into one headline, but knock yourself out and try.

Here is what's wrong with the headline itself:

1. 50 Best Funds refers to mutual funds and there simply is no such thing as a good mutual fund. Now, you could interpret this as the best of the worst thing you can put your money through. Having said that, it remains a mystery why anyone would want to mention that. Nobody advertises other harmful things so it simply makes no sense.

2. Everyday Investor. Every investor should be treated equally or at least given equal choices with their money. This global multi-decade long push into mutual funds is perverted and wrong. 

Look at the list, take a closer look at the returns and then look in the mirror while asking yourself if you really want to pay for that joke. Those of you who will answer with yes get exactly what you deserve which is absolutely nothing. The best return shows a ten year gain of 19.5%. The funds are in U.S. Dollars which has lost roughly 37.8% of its value over the same time period. That's almost twice the so called gain in the funds. Inflation ate away a good portion of the portfolio as well.

You may have been able to increase the numerical value of your portfolio, but you have slashed your wealth and therefore your portfolio was a failure. Heads up to U.S. News as they managed to put a list together of the 50 best funds of the worst funds you could get your hands on. It may be suitable to dumb money investors, but that says it all.

Photo Credit: The picture in the top left corner was created by jscreationzs and downloaded for free use at freedigitalphotos.net.

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