The Future of Mutual Funds
As the industry’s growth slows, expect the push toward ever-lower expenses to continue, with only the best stockpickers thriving.

Should Fund Managers Get Paid for Performance?
Under the typical flat-fee structure used by most mutual funds, investors pay the same fee (as a percentage of assets) regardless of how their funds fare. So here’s an idea: Why don’t active managers walk the talk?

Fund Managers Really Can Pick Stocks
The verdict is in: Fund managers really can pick good stocks. But can investors really pick good fund managers?

Return of the Stockpickers
The primary distinguishing economic trend of the past 30 years is, of course, a steady decline in interest rates, until the federal-funds rate sank to about zero — and stayed there for five years. When rates fall, the markets typically do well. But there’s a surprising connection between rates and active management: When rates rise, active managers beat their benchmarks.

The Trouble With Star Ratings
Mutual fund star ratings from Morningstar are a simple gauge of a fund’s historic risk-adjusted return, but they can be misleading in a variety of ways.

Earning Their Keep
It’s harder than ever to run a truly actively managed fund. Here’s how four firms execute unique — and successful — strategies.

How to Pick an Index-Beating Fund
Cultures that focus on blame are really bad at statistics. Don’t invest with them.

Fund Managers Can Add Value Even in Mega-Caps: Morgan Stanley
Managers investing exclusively in these giant stocks should still be able to deliver “alpha.”

Is Your Fund Manager Active Enough?
A measure called “active share” tries to differentiate active managers from closet indexers.

The Worst-Kept Secret Catches Up to Fund Managers
The rebellion against high fees is nothing new. Almost from the time they set up shop a century ago, fund managers have been criticized for charging too much for a service that offered little or no advantage to individual investors.

Why Indexing Beats Stock-Picking
Most active equity managers fail to keep up with the benchmark index because average index returns depend heavily on the relatively small set of best performing stocks.

Berkowitz’s Returns Rise From Worst to First as AIG, BofA Rally
Bruce Berkowitz’s Fairholme Fund is poised to post its best year in a decade, led by the rebound of financial firms that fueled what he called a “horrible” 2011.

How much does your money manager cost you?
Charley Ellis may not be a household name, but he commands the respect of many savvy investors. He shook up Wall Street in 1975 with a landmark article in a financial trade journal that attacked the notion that professional money managers consistently beat the market.

The fund emperors’ new clothes
Fund professionals sell active funds, but invest personal assets passively.

US mutual fund fees continue to plummet
The expense ratios of US mutual funds continue to plummet as competition from index and exchange traded funds gathers pace. This is forcing the country’s active managers to slash fees to stay in the game, new research suggests.

Do Mutual Funds Still Make Sense?
The popularity of ETFs is making many retail investors wonder if investing in mutual funds is an appropriate long-term strategy.

Securities lending adds return, risk for funds
With rising short interest and low fees, it’s an attractive practice for mutual funds and ETFs, but may not be good for investors.

The active management edge is found furthest from the benchmark
The key for advisers is weeding through the expansive universe, which starts with looking for active managers who are not simply hugging the benchmark in an overly cautious effort to not get beat by it.

Debunking 4 common myths advisers have about mutual funds
Mutual funds aren’t getting nearly as much attention as ETFs these days. It’s ironic because mutual funds continue to be enormously popular with investors and advisers, and remain some of the most widely-owned investment products in the world.

Mutual fund outflows add to the pain of capital gains distributions
Even without selling shares of a mutual fund, investors can incur capital gains taxes triggered by security sales within the fund. And those security sales are often driven by net outflows from the fund, which leaves fewer investors to absorb the capital gains distributions.

Active management is no panacea for down markets
Unfortunately for active managers, a recent study that looked at the past 20 years of mutual fund returns found the promise of active management in down markets is too good to be true.

Sweeping changes under way at DFA
For the first time in more than 20 years, Dimensional Fund Advisors is changing the way it builds equity portfolios.

Fund managers should go into the closet when markets drop
There is an incentive for active managers to closet-index in down markets, as investors do not reward outperformance with higher inflows, and the basis for a fund manager’s income is usually net asset size.

Active share shines light on funds’ alpha potential
Actively managed equity funds have been besieged for years by cheaper index funds, but a newly popular metric might give them a chance to turn the tide.

Alpha dogs as talent shortage looms for stock portfolios
Although increased correlation among stocks is a popular theory for why active managers have failed to beat their benchmarks, there is plenty of opportunity to produce alpha in the market, lending credence to the theory of a talent drought.

CalPERS switches to all-passive defined contribution plans
The California Public Employees’ Retirement System’s investment committee has voted to replace the stand-alone actively managed funds in its supplemental-income plans with passive options.

Why John Bogle is both gratified and terrified by Vanguard’s success
Index-fund creator taken aback by the company’s dominance in the industry; index fund ‘gold ignot.’

John Bogle has already won
Investors have poured money into the lowest-cost funds and ETFs over the past decade, data show.

7 problems with mutual funds
Mutual fund executives owe their livelihoods to shareholders, but most treat investors like ordinary customers rather than partners or bosses. Here is how fund companies could serve shareholders better.

How many fund managers is too many?
Funds with multiple managers may underperform.

7 mutual fund ads you’ll never see
By now most Americans know they rarely get the whole story from government or big business. And despite lots of government regulation, mutual fund companies are no exception.

Fixing money-market funds before the next crisis
How you feel about the potential loss of a few pennies is different from how you might feel about the loss of a few billion pennies.

You’re overpaying for money management
If you want to see a crowd of investors cheer, tell them that mutual funds charge too much and deliver too little. But if you want them to get the real message behind money management, tell them a lot of investors are overpaying for what they think is low-cost money management.

What to do when your fund changes managers
If you invest in actively managed funds, the departure of a manager should concern you. If it doesn’t, that tells you something about the fund, good or bad.

Fund investors: Ignore individual stocks
If you want proof that investors should not be too concerned over any one individual name in an ordinary fund’s portfolio, look no further than the stock that had everyone talking a year ago — Facebook hottest initial public offering since Google.

Is that mutual fund overpriced?
How to tell when a fund’s costs are too high.

5 ways to be the best investor you can be
Is active money management a loser’s game?

The problem with award-winning funds
Investors need to look longer term.

7 gifts mutual funds should give investors
More transparency could lead to increased earnings.

A fund-picking strategy for nervous investors
Look for managers with the flexibility to limit losses.

10 things mutual fund companies won’t say
How runaway pay, powerful lobbies and rising fees are diminishing the value of the humble mutual fund.

The case for active fund managers
Find standout investors outside the mainstream.

Fund Managers: Really, Really Bad at What They Do
In 2011, the overwhelming majority of professional fund managers picked the minority of stocks that underperformed the market. Over the long haul, a higher percentage of fund managers underperform an index than stocks underperform an index.

8 Fund Forecasts for 2013
An ETF price war and other predictions for the new year.

Why Mutual Fund Guardians Are Failing
Every fund has a board of directors who are supposed to protect investors. But are they up to the task?

Mutual Funds That Are Too Big to Succeed
Turns out, the bigger a mutual fund gets, the worse it performs. Why some pros now think big isn’t so beautiful.

S&P Indices vs. Active Funds (SPIVA®) Scorecard – Year-End 2015
In 2015, 66.11% of large-cap managers, 56.81% of mid-cap managers, and 72.2% of small-cap managers underperformed the S&P 500, the S&P MidCap 400®, and the S&P SmallCap 600®, respectively.

S&P Persistence Scorecard – January 2016
Relatively few funds consistently stay at the top. Out of 678 domestic equity funds that were in the top quartile as of September 2013, only 4.28% managed to stay in the top quartile by the end of September 2015.

Lower Fees Are Great, if You Actually Get Them
Investment costs are full of unpleasant surprises, and academic studies have found that many people aren’t taking advantage of better-priced alternatives.

Investors Stick With Assets That Mimic Hedge Funds
Mutual funds that mimic hedge fund strategies — the so-called liquid alternatives sector — were among the hottest investments just a few years ago. There may be early warning signs that that is about to change.

The High Fees You Don’t See Can Hurt You
High fees, often hidden from view, are still enriching many advisers and financial services companies at the expense of ordinary people who are struggling to salt away savings. The problem has persisted year after year.

Investing May Be Cheaper, but Fees Still Hurt
Mutual fund expenses can take a big bite out of shareholders’ returns. That bite, on average, is shrinking, but academic and industry experts say it could — even should — be diminishing faster: Plenty of investment companies still charge a lot, and many consumers still opt for pricey funds.

When Bond Yields Rise, Go Long. Also Short.
Long/short bond funds hold a mix of positions, some that benefit when prices rise and others when they fall. The long and short holdings can be in bonds with different maturities: high yield versus investment grade or foreign versus domestic.

Fees on Mutual Funds Fall. Thank Yourself.
Wall Street is reaping mounting revenue from mutual funds and exchange-traded funds, yet investors are paying lower fees.

Tech Money Sends Funds on the Hunt for Unicorns
Big money managers including Fidelity Investments, T. Rowe Price and BlackRock have all struck deals worth billions of dollars to acquire shares of private companies that are then pooled into mutual funds that go into the 401(k)’s and individual retirement accounts of many Americans.

How Many Mutual Funds Routinely Rout the Market? Zero
The bull market in stocks turned six last Monday, and despite some rocky stretches it has generally been a very pleasant time for money managers, who have often posted good numbers. Look more closely at those gaudy returns, however, and you may see something startling.

In Emerging-Market Bonds, Political Risk Is a Constant
For the last several years, emerging-market bond mutual funds and E.T.F.s have offered better returns than developed-world debt. It’s important to recognize that those higher returns come with higher risks.

Rules of the Fund Road: Watch the Fees, and Don’t Look Back
How an investment performed in the past doesn’t work: Past performance doesn’t guarantee future results. How much a fund charges in expenses does work. Within certain limits, fee levels provide an excellent guide to the future.

When You Evaluate a Fund Manager, Look Beyond Results
Starting next quarter, the losses from the financial collapse will no longer be included in the five-year picture of mutual funds. Here are some suggestions for delving deeper into a manager’s track record so that you don’t pick one whose performance will get an undeserved boost with the new quarter.

One Answer to the Index Fund: Build a Better Index
Several companies say they already have created a better mousetrap — broad index funds that can beat the overall market, rather than merely matching it, even including fees.

An Intriguing Product That’s Too Complex for Many
Many investors and their financial advisers have been lured into alternative mutual funds, which use an array of complex investment strategies meant to protect clients against steep market declines, for instance, or hedge against interest rate movements.

Target-Date Funds Might Not Hit Your Bull’s-Eye
Target-Date funds are all intended to do the same thing: reduce stock market risk incrementally the closer you get to your retirement target date. But that does not mean the funds are entirely adequate for every rainy-day situation.

When Weak Balance Sheets Outperform the Strong
The market has richly rewarded investors in many companies with weak balance sheets — those that have relatively high debt loads. The Fed’s policy of low interest rates has enabled such companies to refinance their debt more cheaply, often driving up their share prices.

Study Says Broker Rebates Cost Investors Billions
The rules governing Wall Street generally force stockbrokers to seek out the best prices for clients who pay them to buy and sell shares. In recent years, though, brokers have had another enticement that can pull them in a different direction: payments from stock exchanges in return for sending them business.

Want an Active Investment Manager? Here’s What to Look For
A report released this week from Barclays Wealth and Investment Management, “The Science and Art of Manager Selection,” aims to lay out the risks of trying to read past performance into future returns when selecting active managers — as opposed to passive management of your money through index and exchange-traded funds.

The 2018 Comeback That Wasn’t for Stock Pickers
A volatile market was supposed to give stock pickers the opening they needed to win back investors lost to cheaper index funds. Instead, a dismal 2018 proved it is never easy to beat the market.

Your Fund Performance Is Even More About Luck Than You Thought
Due to volatility, investors often fail to beat the market with a proven strategy—even if they stick to it for as long as 10 years.

Why Fund Investors Should Look Beyond Fees
Funds tracking the same index can produce different results for reasons other than fees, so it’s important to look under the hood

The Morningstar Mirage
A lot of these investors, and the people paid to guide them, take for granted that the number of stars awarded by Morningstar to a mutual fund is a good guide to its future performance. By and large, it isn’t.

What ‘Liquidity’ Means for Fund Investors
For fund investors, a confluence of market forces and regulatory changes is set to put liquidity in sharper focus.

A Fund’s ‘Peak’ Performance Matters
Many investors don’t look at how funds performed during the complete cycle of a bull and bear market, instead relying on typical industry yardsticks such as one-, three- and five-year returns.

For 90% of All Stockpickers, a Decade and a Half of Underperformance
Over the 15 years ending December 2016, 95.4% of U.S. mid-cap funds, 93.2% of U.S. small-cap funds and 92.2% of U.S. large-cap funds trailed their respective benchmarks, according to the latest S&P Indices Versus Active funds scorecard.

Active Managers Stage a Comeback
With more active funds outperforming, some asset managers are optimistic the resurgence will slow the flow of money into index-tracking funds.

Thirty Years to Here: How the Market Grew ‘Passive’
The growth of “passive” investing through index funds and quantitative strategies over fundamental analysis and stock picking isn’t something that just happened overnight.

Investors Leave Active Funds Despite Fee Cuts
The growing popularity of passive funds and an increased investor focus on fees has put unprecedented pressure on stock and bond pickers.

Meet the New Corporate Power Brokers: Passive Investors
Passive funds used to be unequipped and unwilling to weigh in on most corporate events. With their new power, they are waking up to how much sway they can exercise over takeovers, the fates of chief executives and other crucial decisions.

How Passive Funds Trim Your Tax Bill
Taxes knocked an average of 0.96 percentage point a year off the returns of about 2,000 actively managed U.S. stock mutual funds over the 15 years ended in September 2014, if they were held in taxable accounts. By contrast, taxes reduced the returns of 130 broad-based U.S. stock index funds by an average of 0.69 percentage point a year over the same period—about one third less.

Poor Performance Is Not Driving Fund Managers Out of Business After All
Stock pickers have lagged behind the market and suffered hundreds of billions of dollars of investor outflows over the last five years. Yet the number of actively managed stock funds on offer has hardly dwindled over that span.

Are Fund Managers Doomed? Making the Case for Passive Investing’s Triumph
By almost any measure—performance, inflows and certainly bang for the buck—passive funds for years have trounced active managers. But can the superior performance continue, or are there limits to their success?

The Dying Business of Picking Stocks
Passive investing has become investors’ default, driving billions into funds that track indexes. It’s transforming Wall Street, corporate boardrooms and the life of the neighborhood broker.

As Emerging-Market Funds Drop, So Do Fees
U.S. investors have found one benefit in the emerging-markets rout of the past few years: falling mutual-fund fees. The cuts follow fee declines in other mutual-fund categories driven by the rise of exchange-traded funds, which are designed to mimic the performance of an asset class or index, and a push by institutional investors to lower costs.

A Mutual-Fund Fee Falls Out of Favor
A controversial type of mutual-fund fee—in which dollars are subtracted from fund assets to compensate brokers and other distributors—is losing favor.

Lessons From the Downturn of ‘Hedge Lite’
The recent rise and fall in demand for a new breed of mutual funds billed as “hedge funds for the masses” holds some hard-learned lessons for individual investors.

Commodity Funds Fall Short, Study Says
Sobering news for investors in specialty-commodity mutual funds: On average, they fall short on key measures, new research has found. The funds’ high expenses are often to blame.

Funds That Sought to Cut Risk With Bonds Are Having to Think Again
All-in-one mutual funds for people nearing retirement face tough decisions on how much risk—and which risks—to take in search of decent returns. Target-date funds for investors in or near retirement are more exposed to bonds than they have been in years.

A Mark Against Broker-Sold Funds
A new study finds evidence that suggests that when such funds are sold through brokers, their returns—after fees are taken into account—underperform those of similar funds sold directly to investors.

Healthy Marriage: ETFs and Active Funds
Investors might do well combining ETFs and mutual funds in a portfolio—if they can find actively managed funds that are proving their worth.

Some Funds in Your 401(k) Aren’t Really Mutual Funds After All
In recent years, more 401(k) plans have replaced the mutual funds in their investment lineups with collective investment trusts. These investments look and act a lot like mutual funds, but generally have lower fees and disclose less about their inner workings to 401(k) participants.

What a Fund’s Top 10 Holdings Don’t Tell You
Top 10 lists are fun, easily digested and make people feel they are in the know. But a mutual fund’s list of top 10 holdings isn’t as satisfying.

Advisers Using ‘Active Share’ Hear From Critics
Some fund providers, financial advisers and industry analysts, say active share isn’t a predictor of fund performance, but is sometimes misused as one.

This Is Your Brain on Money: How Investors Trip Themselves Up
Making off-the-cuff decisions, being prone to bias, and getting swayed by market moves. Researchers have found signs of all three behavioral traits in new studies that offer fresh evidence that investors can be their own worst enemies.

How to Pick a Stock Picker
For mutual-fund investors, the less-expensive choice is often the better bet. Other factors to consider besides price include a fund’s long-term performance and whether a fund’s best years occurred long ago, or under the watch of a different manager.

The Simple Math Favoring Index Funds
At the beginning of every year, active managers, fresh off the wounds of the prior year, declare that this year will be a stock picker’s year.

The Case for Actively Managed Funds
Many advisers still believe that at certain times, and for certain strategies, actively managed funds are superior to index funds. That is particularly true, they say, if the active fund has a good long-term track record and charges lower management fees than most of its peers.

Will Funds Outperform in 2015?
As every year, the vast majority of stock-picking mutual-fund managers failed to keep pace with portfolios designed simply to track the broad markets. That’s a trend many expect to continue.

Investors Flee Active Stock Managers
The bad times are back for actively managed U.S.-stock mutual funds. Investors had been pulling huge and growing amounts of cash out of these funds each year for almost a decade, even as the U.S. market hit new highs.

Why a Busy Fund Manager Isn’t Always Best
A debate is on over the concept of “active share”—a measure of how much a portfolio’s stocks differ from those in its benchmark. The issue is whether it is a valid way to evaluate managers.

Merger Funds: More Tame Than Reputation
Some investors have been turning to a mutual-fund niche that may offer an attractive way to diversify away from the risks of stocks or bonds: funds that engage in merger arbitrage.

Mutual Funds’ Five-Star Curse
Take a list of the top-rated mutual funds from years ago—those with five-star ratings from Morningstar Inc.—and look at them now. The sobering fact: You’ll see many once-proud, five-star funds have dropped to four stars, three stars or worse. And there are lessons to be learned from that.

Investors Pour Into Vanguard, Eschewing Stock Pickers
Investors are pouring money into Vanguard Group, the epitome of the hands-off approach to investing, flocking to funds that track market indexes and aren’t run by stock pickers or star managers.

‘Alternative’ Mutual Funds: Different, Yes. Better? Not Lately.
Investors spooked by the stock-market collapse of 2008 have been pouring money into so-called alternative mutual funds ever since. However, many of those investors have taken a beating on their alternative funds as stocks staged an impressive recovery.

Target-Date Funds: Same Retirement Year, Very Different Results
Just because two target-date funds are based on the same retirement year doesn’t mean they will have the same performance. In fact, the two performances may be very, very different.

The New Hedge-Fund-Like Retail Funds
Hedge funds have long served an exclusive clientele of deep-pocketed institutions and wealthy individuals. Now, an expanding array of mutual funds is bringing hedge-fund strategies to the masses.

The Risks of Go-Anywhere Bond Funds
Most unconstrained bond funds replace interest-rate risk with corporate credit risk, which can make their portfolios behave more like stocks. They sometimes shift their holdings dramatically, which can make it difficult for investors to assess how they will fit into a portfolio. And many are chockablock with complicated derivatives.

Actively Managed or Index Funds? Why Not Both?
Some investors swear by actively managed mutual funds. Others are just as single-minded about only owning funds that simply follow an index. But does it have to be an either/or decision?

Why New Mutual Funds Are Better
Mutual funds that are only a couple of years old are more likely to beat the market than those that have been around for a decade or more.

Mutual Funds That Hire Hedge-Fund Managers
As investors increasingly seek exposure to “alternative” strategies, more mutual-fund managers are launching funds that parcel out assets to multiple hedge-fund managers.

How Could I Lose in This Fund? Let Me Count the Ways.
What could go wrong when you invest in a mutual fund? Apparently a lot, if you read fund-company disclosures.

Leveraged Funds Find Their Niche
Mutual funds and ETFs that seek to shift stocks into overdrive have been misused and misunderstood, but some advisers say they can curtail risk greatly when used properly.

Ten Things a Fund Prospectus Won’t Tell You
Whether you have the svelte “summary” version or the less commonly distributed “statutory” prospectus, which can run to dozens of pages, a lot of the information necessary to make an informed decision just isn’t there.

Bad Ways to Pick a Mutual Fund
Investors have shoveled almost $14 trillion into U.S. mutual funds, but a good chunk of that money is riding on mistaken assumptions.

Do Your Mutual Funds Need Hedging?
Critics say putting money in a hedge fund is an unwise bet for many investors. Still, investment firms are offering up more mutual funds that wager on an array of hedge-fund strategies.

A ‘Perfect Storm’ Hits TIPS Funds
Rising interest rates and falling inflation expectations batter Treasury inflation-protected securities.

Low-Volatility Strategies More Popular
Mutual funds that promise gains minus the roller-coaster ride are expanding. But with established, low-cost exchange-traded funds to compete with, these new mutual funds will have to perform well to draw assets.

Are ‘Alternative’ Funds Really Better Than Bonds?
Purveyors of alternative funds are pushing their products to take the place of traditional bond funds. Should you bite?

Why the Top Funds Tumble
Investors who flee the worst mutual funds or private-equity funds can better their chances of avoiding more pain later on.

Currency Funds Valued As Diversifiers Despite Swings
Most mutual funds that bet on the strength or weakness of currencies suffered in recent months, including some stung by swings in the U.S. dollar, but many advisers still see them as a valuable alternative to stocks and bonds.

What to Do if a Fund Closes
These days, funds are being merged with other funds—or closed down altogether—in large numbers. Blame it on the stampede to passively managed products such as exchange-traded funds and away from traditional actively managed funds.

Fashionable ‘Risk Parity’ Funds Hit Hard
Investors who piled into “risk parity” funds, which follow a popular strategy that promises to make money in most environments, are being hit hard by the current market turmoil.

Advisers Turn to Hedged Mutual Funds
Wealth managers are putting more client money into mutual funds that use hedge-fund strategies. The funds work well for clients who can’t meet hedge funds’ large minimum investment requirements or who want the transparency and liquidity that come with a mutual fund.

Closed-End Funds Bite Back
Leverage juiced returns when rates were moored; now it is magnifying losses.

Going Dutch — Could Fee Hurdles Come Down Everywhere?
With markets in turmoil, investors need good advice even more than usual. But investing advice remains confusing, costly and opaque—and that needs to change.

Advisers Weigh Cost of a Managed-Futures Cushion
Managed-futures funds, which helped cushion some portfolios during the downturn, continue to attract investors seeking uncorrelated assets despite slipping returns.

Missing the Target
Target-date funds have become one of the most important ways that Americans save for retirement. But for many investors, the funds are still wide of the mark.

BlackRock Equity Headache Persists
BlackRock Inc., the world’s largest money manager, is completing an overhaul of its underperforming U.S. stock unit, including a purge of management teams at more than half of the funds in the group.

An Old-School Stock Picker Struggles With Index Craze
Mr. Weitz is an active fund manager, who researches every stock before he invests. That pits him against far-less-expensive passive funds that just aim to match a stock index—and whose rise to the fore is upending the way most mutual funds did business for eight decades.

Dear Shareholder: You May Never Get This Message. But Don’t Blame Us.
Brokerage firms sometimes nix fund-firm mailings to investors.

The New ABCs of Mutual Funds
Share classes have changed in popularity as the financial-advice field has evolved.

Burton G. Malkiel: You’re Paying Too Much for Investment Help
Index funds have far outperformed the average active manager, and at a far lower cost to the investor.

Funds Get Active Over Director Pay
Firms like T. Rowe Price say board members shouldn’t receive high pay for just ‘showing up.’

Protecting Your Portfolio From a Downturn
What makes a good fund manager? To many, the answer is easy: Just look at the returns. But recent research points to a different way of sorting out the heroes from the duds: Look at who does well when markets do poorly.

Man vs. Machine: The Great Stock Showdown
It has always been difficult for investors to consistently beat index funds. It has been nearly impossible lately.

Don’t Pay High Fees for Index Funds
You might think that a plain-vanilla index mutual fund is synonymous with low fees. But some such funds are charging expenses that might make even a high-turnover momentum-fund manager blush.

‘Target’ Funds Vulnerable to Rate Rise
Millions of workers saving for retirement risk losing part of their nest eggs if interest rates jump.

A Wish List of Regulatory Changes for Investors
Four experts suggest how Washington officials could benefit individuals buying mutual funds.

How Funds Massage Numbers, Legally
Most investors are familiar with the boilerplate disclaimer that past performance doesn’t guarantee future results. Far fewer are aware of how past performance numbers themselves can be misleading.

Fund Directors Are Feeling the Heat
SEC case against former board members of Morgan Keegan signals tighter scrutiny, lawyers say.

Outside Managers: A Mixed Bag
Here’s why some firms pay others to run their fund portfolios.

Are High-Priced Managers Worth It?
Some stock pickers get paid a lot more than others. Here’s how to decide if they are right for you.

Your Fund Is a Laggard. Should You Sell?
The stock market posted strong returns for 2012, but according to a pair of studies, the managers of about two-thirds of actively managed U.S.-stock funds missed their benchmarks last year.

Finding a Fund Manager Who Can Beat the Market
Think picking stocks is hard? Try picking a good mutual-fund manager.

Beating the Market Without Even Trying
Can you beat the market by not even trying?

Ratings Game: What Do Those Stars and Fund Awards Mean?
The stars are trying to tell us something—about funds. But what exactly we’re seeing isn’t always clear.

Investors Sour on Pro Stock Pickers
Investors are jumping out of mutual funds managed by professional stock pickers and shifting massive amounts of money into lower-cost funds that echo the broader market.

Fund Managers Lift Results With Timely Trading Sprees
The practice, known as “marking the close” or “portfolio pumping,” is a form of “window dressing”—a term for a variety of techniques employed by asset managers to make their results look better at the end of the quarter.

Are You Brilliant, or Just Lucky?
Start by studying a fund’s process, which has three components: analysis, or how the manager assembles the portfolio; behavior, or how the manager responds to the emotional extremes in the market; and organization, or how the business is structured to ensure that investors’ interests come first.

The Stock-Fund Mystery
By one measure, stock picking should be easier than it was in 2011. Yet actively managed stock funds, on average, still are having a difficult a time beating the market.

How Practical Is ‘Tactical’?
Buy-and-hold is beating dodge-and-weave.

Funds Leap Beyond Their Benchmarks
In a world of shrinking bond yields, many mutual funds have found a way to make themselves look better.

What to Do When a Fund Manager Retires
Investors in one of the best-run mutual funds face a quandary: Should they abandon the fund once its portfolio manager leaves?

When It Comes to Fund Performance, History Is Often Written by the Winners
Survivorship bias: Effect on fund performance data.

Can Corporate Culture Predict Fund Performance?
Recent research has found that “corporate culture,” as measured by investment research firm Morningstar, isn’t a reliable indicator of future performance.

Weighing Risk vs. Reward
The Sharpe ratio helps determine whether a fund’s volatility is worth it.

Hold the Applause: Fund Managers Look a Lot Smarter This Year, but…
Stock-fund managers haven’t suddenly gained a lot of IQ points, even though it might look that way.

Beyond Funds’ Star Ratings
Investment-research firm Morningstar rolled out new forward-looking mutual fund “analyst ratings” that purport to show which funds will outperform their peers, adjusted for risk, over the long term.

How the Big Picture Affects Stock Picks
For fund managers, the lesson of recent years is that they can’t ignore the macro impact.