Investing Insights

Episode 4: Why Mutual Funds Are A Bad Investment

Dan Irvine
Principal, 3Summit Investment, Management, LLC

In this episode I discuss why I believe Mutual Funds are bad investments in general. Mutual funds are the sacred cow of the largest investment firms, believe me, I do not make any friends among investing peers when talking about this topic. However, I have always believed that investment decisions should not be driven by the status quo within the industry, but that any investment approach should be able to stand up to the rigors of evidence-based analysis.

Show Notes

Data Sources:

[1] Wanger, Ralph. “A Zebra in Lion Country: the ‘Dean’ of Small-Cap Stocks Explains How to Invest in Small, Rapidly Growing Companies Whose Stocks Represent Good Values.” A Zebra in Lion Country: the “Dean” of Small-Cap Stocks Explains How to Invest in Small, Rapidly Growing Companies Whose Stocks Represent Good Values, Touchstone, 1999, pg. 14.

[2] Liu, Berlinda, and Aye Soe. “SPIVA Persistence Scorecard.” S&P Dow Jones Indices SPIVA Research, Sept. 2018, us.spindices.com/documents/spiva/persistence-scorecard-september-2018.pdf.

[3] Active/Passive Barometer, Morningstar Direct

3Summit Investment Management, LLC is a registered investment adviser.  Information presented is for educational purposes only and does not intend to make an offer or solicitation for the sale or purchase of any specific securities, investments, or investment strategies.  Investments involve risk and, unless otherwise stated, are not guaranteed.  Be sure to first consult with a qualified financial adviser and/or tax professional before implementing any strategy discussed herein. Past performance is not indicative of future performance.

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