Tue Jan 29, 2013, 09:09 PM
Newsjock (11,733 posts)
Mutual fund advisers recommend based on commissions, not performance, new study says
Source: The Globe and Mail
U.S. mutual fund advisers consistently recommend funds that pay them higher commissions, but which often underperform for clients, a newly published study shows ... .
The study, led by Susan Christoffersen, an associate professor at the University of Toronto’s Rotman School of Management, demonstrates a tendency for advisers to recommend mutual funds that pay them greater fees, rather than ones that best suit clients’ portfolios.
Published in the February issue of the Journal of Finance, the study uses filings from the U.S. Securities and Exchange Commission from 1993 to 2009, and is believed to be the first of its kind to use hard data to explicitly draw a link between advisory fees and investment performance.
The study reopens the debate on how well the industry serves its clients, and spotlights the need for investors to scrutinize their funds’ fee structures to ensure their interests are being served.
Read more: http://www.theglobeandmail.com/globe-investor/funds-and-etfs/us-adviser-fees-trump-funds-suitability-for-investors-study/article7982308/
9 replies, 800 views
Always highlight: 10 newest replies | Replies posted after I mark a forum
Replies to this discussion thread
Mutual fund advisers recommend based on commissions, not performance, new study says (Original post)
|Egalitarian Thug||Jan 2013||#1|
|Egalitarian Thug||Jan 2013||#7|
|Dawson Leery||Jan 2013||#6|
|A HERETIC I AM||Jan 2013||#9|
Response to Newsjock (Original post)
Tue Jan 29, 2013, 09:13 PM
Squinch (14,128 posts)
2. Shocked. Shocked, I tell you! Financial people putting their own interests ahead of the customer??
But they seem so sincere!!!
Go with the index funds if you are going to go with Mutual Funds. Not only do they cost less, they often perform as well or better.