There is a simple way to find the best mutual funds to invest money in, but first it is important to understand an important yet little known fact about the mutual fund industry. There is a dirty little secret on Wall Street that mutual fund managers do not want individual investors to know: the majority of mutual funds fail to beat their bench mark averages on an annual basis. In an average year, approximately three quarters of all mutual funds that are actively managed fail to meet their tracking benchmark averages. This failure to beat the benchmark averages means that many mutual fund investors are paying mutual fund managers for nothing, and would be better off investing their money in passive index mutual funds that simply track stock market indexes and charge lower fees than actively managed mutual funds.
The best mutual funds are the ones that consistently beat their benchmark averages and provide investors better than stock market average returns on investment. Luckily for the individual investor, finding the best mutual funds to invest in that consistently beat their benchmark averages is not terribly difficult. A simple search in Internet search engines regarding mutual funds that beat stock market averages will return plentiful mutual fund investment ideas regarding the best mutual funds to invest in.
To check the performance of specific mutual funds versus their tracking averages, investors can make use of the large about of mutual fund performance information that is available on the Internet. Yahoo Finance and MorningStar.com offer mutual fund performance information that includes the performance of individual mutual funds versus their benchmark averages. Using these tools, investors can easily determine how well a mutual fund has performed and whether it is one of the best mutual funds in its category and is worth buying. Keep in mind that to properly assess a mutual fund’s performance versus its tracking index, you have to subtract the annual maintenance fee that the mutual charges from its annual return.
Once an investor is invested in the best mutual funds that have a history of beating the market averages, they can sit back with the comfort of knowing that they are not making the mistake that too many investors make of thinking that all professional mutual fund managers can be trusted stock market averages.
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