Tuesday, April 9, 2019

Mutual Fund Investors

Brett Arends on Market Watch says mutual funds underperform the market because of mutual fund investors..

I have been saying this for years. Mutual funds managers cannot beat the market because mutual fund investors second guess them all the time. They pile money into a mutual fund when the stock market is rising and force mutual fund managers to buy high. They also pile out of the mutual funds when there is crash and cash the mutual fund managers to sell low.

This is the same reason retail (small) investors lose on the market. They buy high and sell low, which is the opposite you should do. But they tend to buy when the market is rising and then get frightened when there is a market crash and sell. That is a losing strategy.

So, if you want to go the Mutual Fund route you probably want a Mutual Fund that is picky about when they will take your money and also do not allow you to cash in on a whim. Or, you can get an index mutual fund.

On my other blog I wrote yesterday about Russel Metals Inc. (TSX-RUS, OTC-RUSMF) ... learn more. Next, I will write about Supremex Inc (TSX-SXP, OTC-SUMXF) ... learn more on Wednesday, April 10, 2019 around 5 pm.

This blog is meant for educational purposes only and is not to provide investment advice. Before making any investment decision, you should always do your own research or consult an investment professional. I do research for my own edification and I am willing to share. I write what I think and I may or may not be correct.

See my site for an index to these blog entries and for stocks followed. I have three blogs. The first talks only about specific stocks and is called Investment Talk. The second one contains information on mostly investing and is called Investing Economics Mostly. My last blog is for my book reviews and it is called Non-Fiction Mostly. Follow me on Twitter. I am on Instagram. Or you can just Google #walktoronto spbrunner8166 to see my pictures.

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