The Great Mutual Fund Trap

Gregory Baer & Gary Gensler


In Circulation

Convinced that your star mutual fund manager will help you beat the market? Eager to hear the latest stock picking advice on CNBC? FORGET ABOUT IT! The Great Mutual Fund Trap shows that the average mutual fund consistently underperforms the market, and that strategies for picking above-average funds -- everything from past performance to expert rankings -- are useless. Picking individual stocks on the advice of brokers and analysts works no better. The only sure things are the fees and commissions you’ll pay.

Fortunately, the news is not all bad. Investors willing to ignore the constant drumbeat of “trade frequently,” “trust the experts,” and “beat the market” now have the opportunity to do better. Using new investing products investors can earn higher returns with lower risks.

Drawing on their years of Wall Street, Treasury and Federal Reserve experience, Gary Gensler and Gregory Baer offer a fresh and realistic look at how money is managed in America. From new indexing strategies to risk-managed stock selection, The Great Mutual Fund Trap offers investors an escape from high costs and immunity from seductive marketing messages.

What will you learn from this book

  1. Fees and Expenses: The book addresses the impact of fees and expenses on mutual fund returns. It highlights how high fees can significantly eat into investors' returns over time.

  2. Performance: Baer and Gensler discuss the challenges associated with mutual fund performance. They delve into factors that can affect fund performance, such as market volatility, fund manager skills, and investment strategies.

  3. Transparency and Disclosure: The book emphasizes the importance of transparency and clear disclosure of information by mutual funds. Investors should have access to clear and understandable information about fees, risks, and holdings.

  4. Conflicts of Interest: Baer and Gensler explore potential conflicts of interest within the mutual fund industry. They discuss how conflicts might arise between fund managers, shareholders, and affiliated companies, impacting decision-making.

  5. Index Funds vs. Actively Managed Funds: The authors compare index funds to actively managed funds, discussing the differences in investment strategies, costs, and potential returns.

  6. Regulatory Environment: The book discusses the regulatory environment surrounding mutual funds. It examines how regulations impact fund operations, investor protection, and industry practices.

  7. Investor Education: Baer and Gensler stress the importance of investor education. They encourage investors to become informed about the mutual fund industry, its workings, and the factors that can affect their investments.

  8. Diversification and Risk: The authors discuss the role of diversification in managing risk within mutual fund portfolios. They explore how diversifying across asset classes and investment styles can impact returns and risk exposure.

  9. Long-Term Perspective: Baer and Gensler advocate for a long-term perspective when investing in mutual funds. They highlight the significance of patience and discipline, especially during market fluctuations.

  10. Investment Strategies: The book offers insights into different investment strategies employed by mutual funds, including growth, value, and sector-specific strategies, and their potential implications for investors.

Language English
ISBN-10 0-7679-1072-9
No of pages 335
Font Size Medium
Book Publisher Bantam Dell Pub Group
Published Date 06 Jan 2004

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