inexpensive sunroom additions mchenry county 2nd floor additions ranch homes lakemoor second floor additions to ranch homes double wide kitchen remodel creative remodeling fox river grove .. Chicago Drug testing

A Good Fund Manager

Every Wall Street analyst, financial planner and broker will tell you that the right way to pick a mutual fund is find a good money manager of a fund that has a long time record.

Yes, I believe that too, but it is amazing that when you go back in time to see what this genius did with the mutual fund, you will find years he has had some terrible losses. Would you want to own that fund then? In the year 2000 about 60% of all mutual funds declined. Many had losses of 30%, 40% and many over 50%. That is when they tell you things like: "you have to be in for the long haul", "this is only a market correction" and "the market always comes back". Among others.

One of the best-known mutual funds, Fidelity Magellan, dropped from a high last year of 146 to 100. That is a 32% loss. Yet this fund manager received a salary of over a million dollars. Did you know the average fund manager made $290,000 last year? How can that kind of money be paid to a person who loses your hard-earned cash? The great majority of fund managers today have not experienced a long-term bear market. They are too young. A few of them did go through the 1987 crunch in which the bottom was reached in 3 weeks. They did not have a chance to sell off their weakest stocks. Of course, they had plenty of time before that fateful 508-point one-day loss to unload some of their dogs. Unfortunately, fund managers are not taught to sell and they definitely do not understand that sometimes cash is the best position.

A major fallacy of mutual fund charters is that they must always be fully invested. There are many funds that have specialties such a Pacific Rim, Russia, real estate, indexes of various kinds, socially responsible, big cap, small cap and on and on. There are times when almost everything in that sector is going down and there is nothing to buy, but the fund charter maintains they must be fully invested. In defense of the fund manager he must buy even if it is garbage. He is not allowed to preserve the investors capital by staying in treasury bills.

If you think a fund manager who loses 30%, 40% or more of your money at any time is a good fund manager then you have been snookered by Wall Street. There is only one way to protect yourself from that type of money mismanagement and it is very simple. If the fund you own drops more than 15% from its highest price any time after you own it then you must sell it immediately even if there is a sales charge or redemption fee. The first rule of investing is "protect your capital". You even have to protect yourself from "a good fund manager".

Al Thomas' book, "If It Doesn't Go Up, Don't Buy It!" has helped thousands of people make money and keep their profits with his simple 2-step method. Read the first chapter at http://www.mutualfundmagic.com and discover why he's the man that Wall Street does not want you to know.

Copyright 2005

In The News:

Learn to Calculate a Stock?s Pivot Point

Stocks breakout from properly formed bases everyday but many investors... Read More

Analyzing Growth Stocks: An Important Focus For Any Investor

Analyzing growth stocks is an important focus for any investor.... Read More

VooDoo Training For the Stock Market

If you go to Haiti or other places in the... Read More

Economists

In today's volatile and confusing stock markets everyone is searching... Read More

Cash Is A Position

I go to the Money Show every year to visit... Read More

A Common Misconception about Stock Prices

I cringe every time I hear a novice investor tell... Read More

Patterns

The Law of Chaos is the theory of random unpredictable... Read More

Big Buildings Can Mean Big Economic Disaster

AS BUILDERS BEGIN WORK ON THE FREEDOM TOWER in New... Read More

Trading Education: The Best of Both Worlds!

I made my very first investment in the stock market... Read More

Investing in Dividend Paying Stocks

I was recently interviewed for a press release through a... Read More

Successful Trading ? Taking Profits - Part 2

Suppose your position has made a big move and you... Read More

Are You A Stockaholic?

Today's society gives special recognition to alcoholics, sexaholics, binge-aholics, shopaholics,... Read More

How to Read an Annual Report

Every publicly traded company is required by the SEC(Securities and... Read More

Trading Tips No 8: Picking the Best Stock Market Price

Carefully thinking through your goal as a trader is of... Read More

401K-itis

Are you one of those many people who dread reading... Read More

Humpty Dumpty the Stock Market Falls Down

Humpty Dumpty had a great fall and all the King's... Read More

Your Trading Objective: Why is that so Important?

You've decided to try your luck at trading stocks or... Read More

Inertia Syndrome

When it comes to buying a stock or mutual fund... Read More

Exchange Traded Funds Primer

Exchange Traded Funds (ETFs) are a group of passive index... Read More

Lifestyle Funds Provide Greater Security?

With the stock market stubbornly refusing to settle down and... Read More

Mousetrap

The spring-loaded rat catcher is the ultimate low-tech device invented... Read More

What Does it Take to be a Stock Trader?

It takes a total mental commitment to the task. It... Read More

Does Japan Matter?

For the last 12 years we have seen the Japanese... Read More

Is the Stock Market for You?

Many people would like to diversify their portfolios to expand... Read More

Planning Your Dive and Diving Your Plan ? Trading!

A colleague of mine just returned from a scuba diving... Read More

energy efficient led lighting led high bay lights Pete's produce ..
energy efficient led lighting led high bay lights Pete's produce ..