The Past Performance Of A Mutual Fund Is Not An

   

Indicator Of Future Outcomes ... 96% Of The Time

 

It's almost impossible to ignore past performance when picking a mutual fund to invest in. Indeed, past performance is often the first thing a mutual fund will reveal about itself. "The phrase 'past performance is not an indicator of future outcomes' (or some variation thereof) can be found in the fine print of most mutual fund literature," writes Aye Soe, Director of Global Research & Design for S&P Dow Jones Indices. "Yet due to either force of habit or conviction, investors and advisors consider past performance and related metrics to be important factors in fund selection."

           

When it comes to the stock market there’s a tremendous amount of fun facts and stats that are often shown in pretty little tables and infographics. If you tweet out a good one you’ll likely get a couple retweets and maybe a new follower. But what good are they? People love counting and that passion has seeped into how traders view the market.

          

We do love our selfies. It’s kind of like a photographic “Where’s Waldo?” of our lives. “Hey, can you see me?”  “Am I cool or what?” While you can have some fun with this, there’s another selfie that can truly add to your overall life happiness: your Money Selfie. You turn the lens around and see how your money mindset fits in your life. Ready? Sit up and smile and check out where you are in your money life.
       
 

Former penny stock Cynk Technology Corp.'s wild ride to a $6 billion valuation has caused quite a stir, but there is an important takeaway for investors. Cynk, a purported social network which has no revenue, no product, no assets and one employee, saw its stock price surge from six cents to more than $20 before the SEC stepped in on Friday and halted trading. Yes, that’s a rally of more than 36,000% for a stock that trades over-the-counter.

 

 

More Good Stuff :

 

Investment Plans Are Always Forecasts | Seeking Alpha

       

7 market myths that make investors poorer - MarketWatch

        

The Target Date Tragedy | PRAGMATIC CAPITALISM

           

Top 10 Reasons Financial Advisors Stink - Alpha Architect

         

The truth about Dow 17,000 - MarketWatch

       

Take Your Money Selfie - Forbes

      

Mutual Fund Performance Persistence - Business Insider

         

The Farce of World Cup and Investment Models  - Bloomberg View

      

The Virtues of Pragmatism • Systematic Relative Strength

          

Cynk’s Frenetic Trading: An Important Lesson - WSJ

         

Market Stats, Fun Facts, and Why You Can Ignore Them | Andrew Thrasher

          

Reconciling S&P 500 with US Economy • Systematic Relative Strength

           

 

 

 

 

 


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