A Simple Plan

April 17, 2008
By seadmin

Want to fix your ailing mutual fund portfolio but aren’t sure how to begin the process?

If this describes your situation, don’t fret. I have devised a simple plan to help you get back on track toward a more prosperous 2008.

Here are the five steps you need to take right now.

1. Type, Ticker and Fund Family

What kind of fund is it? What is the ticker symbol and which company manages it. This is the most basic info, but you need to know it before you can proceed with your research.

2. Fees, Commissions, Surrender Charges, 12b-1 Fees

Knowing how much you are paying might open your eyes to what your funds really cost. It might even irk you enough to get you to make a change.

3. Bull and Bear Market Performance

Most funds do well in the best of times, but how do they handle adversity? If your fund doesn’t measure up during rough patches, you need a change.

4. Ratings and Relative Performance

Morningstar is a company that provides ratings for mutual funds, and if you look up your fund on Yahoo! Finance, you will see the Morningstar ratings right there. Find out how your fund is doing in relation to other funds of the same kind. If your fund is floundering, you need to make a change.

5. Comparable ETFs

Here’s the most important step in this process. If you’re not happy with your fund after walking through the first four steps, then you need to find a comparable ETF to replace it. This can be done by identifying the type of fund (step 1), and then looking for its ETF counterpart. Here again, you can use Yahoo! Finance to get you there.

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