siding calculator replace siding siding calculator lakemoor painting aluminum siding siding replacement beach park .. Chicago Drug testing

Low Expense Ratio

One of the big advertising kicks today from mutual funds is to tell how low their expense ratio is and that you will make a great deal more money if you buy and hold with them. Partly true, but that is not the whole story.

What is the expense ratio? It is all their overhead including but not limited to all the managers and other employees salaries, rent, computers, utilities, travel (the fund manager says he has to visit a company in Florida in the winter to see how it is doing), advisory services, telephone, etc., etc, etc. Oops, and don't forget the manager's bonus whether he makes money for you or not. If the fund has one billion (yes, that's a B) that means they can spend $10,000,000 on expenses and no one will complain because it is a tiny 1%.

At some point expenses just about stop going up as you don't need very many more people to manage the paper work for a billion than you do for 250 million. The fund manager's duties remain the same just the size of the orders he places changes. Actually as a fund grows in size its expenses should automatically come down as a percent of assets, but you will find that is not the case for many funds. They keep sticking it to their investors who don't have any idea how egregious this is.

The larger the fund family the lower should be their expenses per fund as they can outsource from the fund to a central billing and customer service desk.

Vanguard Funds has more than 100 individual funds in its family and they brag on how low is their expense ratio. It should be as they have more than 720 Billion spread out over those funds. They keep their expenses low and at only 1/2% they can charge about 360 million to offset their overhead.

Many funds run very high expenses. This is especially true for new and smaller funds, but as they take in more money they can spread their expenses and lower their ratios. One of the recent criticisms of funds is they have been making extra charges labeled 12B-1 that are supposed to be expressly for promotion to bring in new customers. Unfortunately, some (not all) of the fund managers have been pocketing this. If this does bring in new money then the expense ratio should fall and again in many cases it has not.

Investors expect fund managers to be honest. When large sums of money are at stake it seems to bring out the worst. That real nice fund manager turns into a hungry wolf and the investor becomes one of the 3 little pigs that did not escape.

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:

Direction

It is difficult to make money in a bull market,... Read More

Option Spread Trading

Spread trading is a technique that can be used to... Read More

On Line Stock Trading: Small Cap & Micro Stocks Go Up and Down - How Can You Profit?

Success in small cap & micro cap stock trading like... Read More

Ignore Stock Market Talking Heads

You should ignore analysts on TV, the radio, the newspaper... Read More

High Price/Earnings Ratios and the Stock Market: a Personal Odyssey

After some forty years of banking and investments, I retired... Read More

Nest Eggs and Omelets

Do you have a nest egg? You know, a place... Read More

Investing in the Stock Market

From the book 'The Stockopoly Plan' by the author Charles... Read More

Investment Discipline

One of the great "secrets" of successful people is discipline... Read More

Swing Trading Strategies

Using Swing Trading Strategies and Technical Analysis when Trading Stocks... Read More

Economists

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

Long Term Investing

In his wonderful book, 'Multiple Streams of Income', best selling... Read More

Dividend Paying Stocks

I would like to share with the reader an article... Read More

The Stock Market Doesnt Care if You are a Beginner?. Get Prepared to Succeed at Trading

Stock trading remains a very competitive field and the stock... Read More

Learn to Calculate a Stock?s Pivot Point

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

Trading Stocks ?Never Forget About A Past Trade

We all know that emotions control every decision that an... Read More

Protectionism

First let's see what protectionism is. According to Mr. Webster... Read More

Enronization

Even if you don't own any of their stock or... Read More

Rebalance And Diversify

The stock market has not been very kind to your... Read More

Hot Stock Trader: How to Pick Momentum Stocks with Ease and Simplicity

Most stock traders know that momentum trading can be a... Read More

Hot Stock Investing ... How to Pick Hot Stocks with Momentum Stock Trading

Profitable day traders recognize that momentum trading is among the... Read More

Dispelling Illusions of the Stock Market

How can you dispel an illusion unless you look directly... Read More

Box Of Chocolates

Ever have one of those sample boxes of candy? Each... Read More

Municipal Bonds

Because there are so many stocks that are NOT paying... Read More

Pamplona, the Wild Investment Bulls

You remember (they show it on TV every year) the... Read More

VooDoo Training For the Stock Market

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

led light manufacturers in usa led lighting savings Pete's produce ..
led light manufacturers in usa led lighting savings Pete's produce ..