How To Evaluate Mutual Funds

Almost every investor owns a mutual fund. But how many of those investors actually know what it is they own?

In this video I am going to breakdown the most important aspects you need to look at when you're considering mutual fund investing.(By the way, the same things are applicable to Exchange Traded Funds as well.

1. expenses
2. portfolio turnover
3. 30 day SEC yield
4. Tax adjusted returns
5. historical taxable distributions
6. tenure of fund manager
7. portfolio holdings
8. unrealized capital gains
9. size of fund
10. Morningstar Rating

Yes, there are many areas to consider. But once you watch how I do this, you can go to Morningstar.com yourself and analyze your own funds and ETFs.

Remember, my friends, the only return that matters is your NET return, i.e.your return after tax and fees. NOTHING ELSE MATTERS!


The problem though is that trading fees are NOT measured anywhere in the SEC literature you can request on the fund you're looking at.
So, you can not be too sure exactly what your fees are.
However a fund with low turnover will more often than not have lower portfolio costs AND less taxable distributions too. Which should make the fund a stellar performer among its peers.

So, look for low turnover, low fees, low historical tax adjustments, a long running portfolio manager, a high Morningstar rating, etc.

Here is my article on trading costs. heritagewealthplanning.com/mutual-fund-expenses/

Here is the Morningstar link I was using in this vidoe. morningstar.com/funds/XNAS/VASGX/quote.html

Don't forget to visit my website at www.heritagewealthplanning.com and sign up for my podcast, The Josh Scandlen Podcast.

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