How Can I Find The Best Performing Mutual Funds?
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As the old saying goes, “You judge a horse by its track record,” and that is probably true in most instances. However, it is not necessarily true when assessing the performance of mutual funds. Using past performance to determine a fund’s future performance is much like looking behind you to see ahead. It is not exactly an effective measure.
There are several companies that assess mutual funds and assign them ratings based on specific criteria. Quite often, those criteria consist of viewing the fund’s past performance over a five year or ten year period. However, this method has not proven to be effective in determining how a fund will perform in the future. So, short of polishing up the ole crystal ball and calling in to the psychic hotline, what is the conscientious investor to do?