How
would I select a mutual fund to buy?
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For mutual fund, BMO Investorline also offer search of mutual funds for given
criteria including notes by Morningstar ratings.
However I would personally look at long term performance of a fund for longest
period of time if provided, e.g. 10 year or 20 years if available. Some
criteria I'd look for
- How did it perform each year before 2008-09 financial crisis? in term of %?
- How did it perform during crisis? Plunge %?
- How fast did it recover? Years and % gain?
- Top holding stocks to see if I like those
- Investment in which country? I don't like China.
Some advisors recommended best mutual fund managers, but managers have been
switching companies very often.
Btw, IMO you shouldn't invest in these high risk funds
- Aggressive growth fund
- Momentum fund
Back to many years ago, I saw an advertisement about Trimark's fund managers
went to Russia, which fully covered with snow and decided to invest in snow
tire over there. I like fund managers travelled and research of companies
before investing in. I think, this was why Mr. Peter Lynch out performed Wall
Street by discovering unrecognized firms before Wall Street did.
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