Mutual Funds

When I talk with new investors, one of the most common sources of confusion I encounter is the difference between a bank account and a mutual fund account. We’re all conditioned to think in terms of “balance” versus “available balance” from our daily banking. You have a $500 balance, but only $450 available because a […]

When I hear the phrase “balanced stock mutual fund,” I immediately recognize what an investor is looking for. While this isn’t a formal industry term, it perfectly captures a common investment objective: gaining exposure to the growth potential of stocks while mitigating the inherent volatility through a disciplined, diversified approach. As a finance and accounting

When I discuss financial statements, most people immediately think of a typical operating company – one that manufactures goods, sells services, or produces tangible products. They envision assets like inventory, property, plant, and equipment, and liabilities such as accounts payable or long-term debt. However, a mutual fund company presents a distinct financial landscape, particularly when

I’ve spent the last 15 years managing portfolios, advising clients, and teaching financial planning at the university level. In that time, I’ve seen thousands of investment decisions—some brilliant, many flawed. But one pattern stands out: people treat mutual funds like magic boxes. They pick a few with good past returns, set up automatic contributions, and

In my practice, I have observed that investors often declare a mutual fund “bad” after a single year of poor returns. This is a mistake. True, chronic underperformance is a deeper sickness—a persistent failure to achieve its stated goal that often stems from identifiable, structural flaws. A badly performing fund isn’t just unlucky; it is

In my career of analyzing portfolios and performance data, I have seen the full spectrum of fund management, from the exceptional to the abysmal. A badly managed mutual fund is more than just an underperformer; it is a vehicle for the systematic destruction of wealth through a combination of high costs, poor strategy, and misaligned

Over the years, I’ve been asked countless times whether it’s a “bad time” to invest in mutual funds. For me, the answer isn’t as simple as pointing to market highs or lows. Mutual funds are long-term vehicles, and timing them like individual stocks often misses the point. Still, I’ve learned that there are situations when

Introduction In my years of analyzing investment products and advising clients, I have developed a professional respect for mutual funds. They democratized diversification for the masses and remain a cornerstone of many portfolios. However, my role is not to promote products but to provide unvarnished truth about their mechanics. The narrative around mutual funds often

In my years of analyzing investment portfolios, I have found that the pursuit of income can often lead investors into perilous territory. A “bad income mutual fund” is not always a fund that is losing money; it is often one that is achieving its yield objective through dangerous, unsustainable, or costly means that ultimately destroy

In the modern era of real-time trading and instantaneous settlement, the concept of “backward pricing” sounds like a relic from a bygone age. Yet, understanding this historical practice is crucial, not because it is still prevalent, but because it highlights the dramatic evolution of market structure and investor protection. I have reviewed old account statements