Whatever you do, Ken Fisher states, don't let your spouse read this chapter or he or she will hate you unless you do what Ken Fisher says. Because he or she will either know you're not doing as well as you could with your mutual fund investments, or demand the right to a shopping spree. Sound nuts or weird? It isn't.
Some folks think Ken Fisher is anti-mutual funds. He is not. At all! You know they're a fine vehicle for smaller investors to diversify and get access to professional money management or passive commingled investing more efficiently Ken Fisher explains. But for big investors, Ken Fisher illustrates, they are pretty inefficient and costly. The wealthier you are, the more relatively inefficient they are - and for big investors there are a million better ways to skin that cat. But for smaller pools of assets, the benefits of diversification can outweigh all drawbacks. And mutual funds as a "packaging device" are awfully convenient. Plus, plenty of mutual funds get fine performance Ken Fisher notes.
And you know to pay close attention to the fees with these funds - the higher they are, the more they erode returns. But this is also where folks miss a basic investing truism. Ken Fisher hears from plenty of investors who think their "no-load" mutual funds are just grand. No fees means cheap! Maybe - but sometimes, "cheap" comes at a huge cost. With funds, this is a provable and very slippery slope into potential bunk. Sometimes more is less.
Discover more on BUNK 18 in Ken Fisher's Debunkery.