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For the average investor, the keys to investing success, over the long-term, are diversification and portfolio re-balancing, pretty straight forward.

But before you can even diversify and re-balance your investments, you need to choose the type of investments to make up your accounts, and I’ve written a lot about that, as well.

Here’s where you need to listen up!

Before you choose your investments you need to understand what you CAN and CAN NOT control. I think investors for the most part, have this all wrong.

What am I talking about?

A lot of investors are under the notion that it’s their duty to control the performance of their investments. I say forget about doing this, this is completely out of your control, for the most part. Thinking that you can control your investment performance is the first critical mistake the average investor makes. I would suggest ridding your brain of these thoughts and focusing on what you CAN control.

Continue Reading “The Single Most Important Thing You Can Control (when it comes to your investments)”

Many mutual funds distribute their capital gains near the end of the calendar year, typically in November and December.

If you’re a mutual fund shareholder, it’s important to check with your fund family to see whether or not your fund is going to have a capital gains distribution at year’s end; if so on what day it will occur.

Many funds will give you an estimate ahead of time, detailing the size of the distribution. Here’s a link to a page that details the different short and long term capital gains for the fund family ING and when the fund distributions will occur.

As you can see, there’s a huge difference between the total capital gains for the ING Diversified International Fund (.17%) and the ING International Small Cap Fund (7.89%). Do you think it might be important to be aware of something like that if you’re an ING fund holder? I’d say so.

Continue Reading “An ETF Tax Swap Idea for the Holidays!”

What I’m going to illustrate here is what it would have cost you to own a specific mutual fund last year, using the mutual fund cost calculator.

I’ve created an image (below) that you can click to enlarge. Within the image, I’ve highlighted 14 different areas that I will expand upon throughout this post.

I randomly selected a mutual fund that showed up on the results pages of the Kiplinger fund finder post from a few days ago. The name of the fund is the American Beacon Large Cap Growth Fund (ALFIX), a no load mutual fund.

Just answer a few simple questions

I then went to PersonalFund.com (btw, you have to create an account there using a valid email and password, which takes less than a minute to do) and inputed the name of the fund and a few other facts:

Continue Reading “The best mutual fund cost calculator - in action!”

I first came across the Personalfund.com mutual fund fee calculator in 2001. And what a time to come across such a powerful tool. Back then many equity mutual funds were coming off a decade of unprecedented returns.

Equity mutual funds were fat with fees and weighed down by embedded capital gains; finding an efficient fund was no simple task. For that reason, having the mutual fund fee calculator, to illuminate the way, was a Godsent. (btw, I like to call that time in the market’s history the Java the Hutt period, symbolizing the gorged nature of many a stock or fund.)

Most people, back then, were giddy with their overall investment performance and could care less about the internal costs associated with mutual fund ownership. That slowly began to change, as the market took a turn for the worse in the early 2000’s.

Continue Reading “My favorite mutual fund fee calculator”

In the last couple weeks I’ve written quite a few posts about mutual funds.

I’ve written about the different classes of load funds you can expect to buy through a financial advisor, I’ve written about No load funds, and I’ve written about the difference between the loads and No loads. I’ve even managed to talk about ETF’s in a few of the posts, as well (surprise, surprise).

If you’ve read most of those posts, then pat yourself on the back; you know more about mutual funds then the majority of people out there. Armed with this knowledge, of the many pros and cons of mutual fund investing, it’s time to apply some of our new found wisdom.

Continue Reading “Review of Kiplinger’s Mutual Fund Finder”

As you know by now, mutual funds have hidden fees in the form of institutional brokerage commissions, that are passed on to fund investors.

In the previous post, I detailed how mutual funds pays their brokerage firm(s) a certain amount per share (i.e. 4 cents a share), to buy or sell stocks or bonds, in bulk.

These trading commissions are looked upon as ‘hidden costs’ because most investors are unaware of their existence and mutual funds are not required to tell you about them. And getting published information about the whereabouts of these fees is not easy.

Continue Reading “More on hidden fees- soft dollars anyone?”

I’m finally nearing the end of what was meant to be a one week gig. Somehow it’s turned into a fortnight, to borrow a British phrase used to describe Wimbledon.

I’m quite eager to move more into the ‘down home’ planning phase of the blog, over the coming month, but not before some hard hitting posts to end ‘mutual fund’ week. I’ve saved the best for last.

When I first wrote a piece on mutual funds, back in the beginning of August, I touched on the ‘mystery behind mutual funds’. Now it’s time to dive in head first and examine the murky world of mutual fund hidden fees. (I’m being a bit over dramatic for effect, after all, Halloween is next week)

Continue Reading “Mutual fund hidden fees- the biggest culprit is…”

I just finished writing a plethora of posts about the different kinds of mutual funds. I also managed to sprinkle in quite a few informative tidbits about ETF’s, as well.

After re-reading a few of them, I realized there’s a lot of information to digest.

I don’t regret writing as much as I did, but I can see how the casual reader might get lost in it all. So I’ve decided to condense the most important points about the different investment options into one post.

Here’s what you can expect to receive from each:

Continue Reading “Breaking down your investment options”

Apples to apples, no load funds are by far the most cost effective way to own mutual funds, far more cost effective then load mutual funds.

Now, that fact and a subway token will get you on the subway.

Some people decide to buy luxury automobiles, some people are only interested in a car that gets them from point A to point B. Some people only shop when things are on sale, some people are willing to pay top dollar for the highest quality and a brand name.

As a mutual fund investor, you need to decide a few things for yourself:

1. if cost is going to be the overriding factor.
2. whether or not you want to incorporate all the financial services that exist, outside the provincial world of no load funds.

Continue Reading “The Real Cost of Investing in No Load Mutual Funds is…”

This is a piece I’ve been looking forward to writing for some time. And what does that mean to you? I’m really not too sure, other than it’s probably going to be a longer post than normal, so lets get to it.

But before we start I have to tell you… I’ve never sold a No Load mutual fund in my life so I ask that you bear with me. That’s an inside joke…

I’ve never sold a no load mutual fund because they are NEVER SOLD by financial advisors. I’ll explain why that is and a whole lot more on the list below…

Continue Reading “10 things you need to know about No Load mutual funds”