Too Much Information

By Rich Topps, Sr.

We recently came across a sales piece for a service that monitors mutual funds which raised the question of whether mutual fund managers invest in the funds they manage. At first glance, the statistic that less than half of mutual managers invest in their own funds, suggested that the manager wasn’t confident in the fund investment choices.  Our opinion is “Who Cares?”.  In the investment information business, many purveyors of information seek to raise concern or fear with the hope investors will thereby feel a need for their product or service – sad, but it occurs.

A mutual fund manager may have numerous valid reasons for not investing in a fund he or she manages.  A few examples:

1)      The fund’s objectives may differ from the manager’s personal investment objectives;

2)      The manager may want to avoid the appearance of a conflict of interest – is the fund being managed in his or her best interest or in the best interest of the fund’s investors?

3)      Fees may be a concern as well. Why would he or she pay a fund management fee when they can mirror the individual positions without one?

4)      For completely unrelated reasons, the manager may desire or need to make a large withdrawal – purchase of a home, college tuition, financial emergency, etc. which might be misinterpreted as bailing out of the fund for investment performance reasons. And the list goes on.

So, rather than subscribe to numerous useless information products and services, we suggest you retain an investment professional who develops an investment program suited to your unique individual objectives and has filtered out such useless information. That’s exactly what Bolmgren RetirePLAN does for its clients.  Give us a call or visit our website today.

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