FYI: (This is a follow-up article.)
The Wall Street Journal lit a fire in the mutual fund due diligence world last week, publishing "The Morningstar Mirage," a 19-page analysis of Morningstar’s five-star rating system. In it, the WSJ charged that “funds that earned high [Morningstar] star ratings attracted the vast majority of investor dollars. Most of them failed to perform.” The WSJ continued, “On the average, five-star funds eventually turn into merely ordinary performers.”
The cost of performance-chasing is staggering. ETF investors are not immune. Just ask the crowd that invested $8.3 billion in the WisdomTree Europe Hedged Equity Fund (HEDJ-US) between January 1, 2015 and June 30, 2016.
Regards,
Ted
http://www.etf.com/sections/features-and-news/choosing-etfs-what-matters?nopaging=1
