http://www.reuters.com/article/2012/02/09/us-column-personalfinance-idUSTRE8181G320120209?feedType=RSS&feedName=PersonalFinance&rpc=43"Next month, something very dramatic is going to happen to most stock mutual funds. In fact, it's already started to happen.
The dramatic event is this: Those funds will hit the three-year anniversary of the nadir of the market in March 2009. And that means their three-year-return numbers will start to look amazingly good."
I've already started to notice this while researching funds, because all of a sudden, every fund's 3-year trailing return looks amazing. In other words, useless. Instead I use the growth charts on Morningstar and a period starting around 2008.
Comments
But definitely something people need to be aware of.
The Wall Street Ranter
That's why buy a fund if you are comfortable with manager and hold it. Or buy index fund and trade it. That's my position. Heck sometimes I have bought and sold funds in 1 month because I know end of quarter is coming and some funds are notorious in buying their best performing stocks in an effort bid them up to make their quarterly numbers look better.