Advisor Perspectives Insights into the world of high- and ultra-high net worth investing January 22, 2008- Vol 2, Issue 4
Quick Links Become a Subscriber (Free) Advisor Perspectives Home Page Asset allocation data Mutual fund data		A highly controversial study argues that mutual fund investors are losing money through market timing decisions and, in particular, these loses are more pronounced for funds bought through non-discount brokers.  The study was funded by the Zero Alpha Group, a consortium of advisors advocating passive management strategies.  We review this study and offer our own analysis. The question of whether investors make smart decisions when allocating assets is not limited to individual investors.  We review a recent study of institutional investors, which shows that the "smart money" may not be that smart when it comes to manager selection. Fidelity's flagship Magellan fund reopened to investors, after having been closed for nearly a decade.  We review the history of Magellan and provide our analysis for prospective investors. If you are experiencing problems opening or navigating through our newsletters, we can send you a text-only version.  Please send an email to feedback@advisorperspectives.com requesting the "text-only" version. If you have received this newsletter in error, or you do not wish to receive future newsletters, please use the "Safe Unsubscribe" button at the bottom of this email.
Investor Timing and Fund Distribution Channels The Zero Alpha Group study was widely reported in the media, and created controversy because of its finding that investors buying funds through non-discount brokerage channels suffered poor investment performance, implying that brokers were hurting, rather than helping, investors.  We review the methodology used in the study and the study's findings, and provide our own analysis. Read the article Investor Timing and Fund Distribution Channels: Our Analysis Our analysis shows there is little doubt that fund investors, as a whole, lose money through market timing decisions.  However, with respect to the Zero Alpha Group study, we find the evidence far less persuasive that investors transacting through non-discount brokers suffer a disproportionate share of these loses.  Our analysis is provided at the end of the previous article, and the link below will take you directly there. Read the article Maybe Smart Money - Isn't So Smart Scott Stewart, a one-time institutional asset manager and now a professor of finance at Boston University, completed an extensive study showing that plan sponsors are losing billions of dollars when shifting assets among managers.  We review his study, which shows the criteria used in asset allocation decision. Read the article The Reopening of Magellan We turned to two experts on the Magellan fund to understand its history, its successes, and its failures.  Our analysis shows how the fund is positioned today and why one expert - Jim Lowell - predicts that the fund is positioned to deliver superior performance. Read the article Advisor Market Commentaries We are introducing a new feature that will be a compendium of year end market commentaries from RIAs.  We discuss this project and how you can participate. Read the article Advertise in Advisor Perspectives   Our newsletter goes to over 40,000 RIAs, wealth managers, and financial advisors.  See how you can deliver your message to our sophisticated audience. Read more Advisor Perspectives Box 380 Lexington, MA 02420 (781) 376-0050