Evaluating investment funds or any other type of investment is crucial for a savvy investor. In today’s environment, it’s easy for investors to get influenced by misinformation that ultimately leads them to make sub-optimal investment decisions. We dedicated today’s episode to inspecting the process of how to evaluate mutual funds, ETFs, or any other types of investment funds. Throughout the episode, we explore the process of due diligence and how to decide whether or not a potential fund is worthy of including in your portfolio.

 

 

Show Notes

[2:15] Sub-Optimal Investment Decisions – Grant starts the conversation with why people make sub-optimal investment decisions by not using the right criteria to evaluate mutual funds or ETFs.

[4:00] Terrible Evaluation of Potential Investments – Using the example of large-cap US equities, Grant explains how some of the most popular fund ratings do not provide a very good evaluation of potential investments.

[8:37] Structuring Your Portfolio – The most important decision one has to make in structuring a portfolio is allocating assets. Grant shares high thoughts on why this decision is far more important than focusing on a specific fund and how long-term asset allocation can improve the integrity of your portfolio.

[13:46] Evaluating Strategy – Grant shares how to evaluate the strategies of different investment funds and how to decide whether the strategy of a specific fund aligns with your goals.

[18:05] Historical Performance – Grant discusses why it is so important to take a look at the history, stability, and performance of the fund management company before you decide to invest.

[21:33] Path to the Best Outcome – Wrapping up the episode, Grant shares his take on how having a consistent allocation, a consistent philosophy, and remaining invested through harsh conditions combine to create the path to the best investment outcomes.

 

Resources

ETFs vs. Mutual Funds: What’s the Right Investment Vehicle For You?
abovethecanopy.us/mutual-funds-vs-etfs-whats-the-right-investment-vehicle-for-you/