2008 was a bad year for mutual funds investors. Really!
Source: stck.xchng Photo: lusi
Washington Post wraps up an exceedingly bad year for investors with its take on the US based mutual fund performances.
Among some startling (or not) facts:
The worst performing fund was down nearly 60 percent, the average financial fund declined 42 percent, and not one diversified stock fund bigger than $100 million ended the year with a gain.
Overall, the average mutual fund plunged 30 percent in 2008, and many didn’t fare as well as the Standard & Poor’s 500 stock index, which fell 38 percent for its worst year since 1937.
The article goes on to talk about how the mutual funds were much better investment vehicles compared to hedge funds and so on and how liquidity is better than illiquidity
But here is what jumps out to me. The average mutual fund (-30%) performed better that the S&P index fund (-38%). Hmm, does this mean that professional management improved returns this past year?
On second thoughts maybe they are including bond funds and money market funds in their ‘average’ mutual fund. In that case it is strange that they would make a comparison to the S&P index
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