The Feeling Is Mutual
_Casual The Feeling Is Mutual Like millions of Americans, I've succumbed to the allure of a wild bull market and plunged into mutual funds over the past 18 months. It wasn't so long ago that I had...
...At times, peace of mind...
...It wasn't so long ago that I had no idea what a "mutual fund" was and found myself confounded by their promises to make me money...
...And thankfully, ideology seems to be all but absent from the fund world— though there's an obvious undercurrent of conservatism...
...As a result, I've stopped checking these funds' returns each morning...
...Its returns were among the very highest in its category, and though its volatility rating was high, I figured I was in for the long haul and could manage the ups and downs...
...Now, I am familiar with arcana like the importance of a fund's net asset value ("NAV" to those in the know...
...Matthew Rees...
...I would scrutinize the box scores and get either a great thrill or a huge disappointment, depending on the performance of demigods like George Brett and Larry Bird...
...No, I'm not married to the governor of a small southern state, and, no, I don't have any friends with names like "Red Bone...
...And just like their brethren in politics, fund managers tend to splash their own faces across mutual-fund ads and to give their funds names weighty with purpose...
...Seeing as how liberalism is in retreat generally, it shouldn't surprise that even during this sustained bull market these funds have generated meager returns...
...I've also been informed that the management of one of my other funds has been turned over to PBHG...
...That's earned it a spot on the New York Times's dreaded "Laggards" list...
...At some point, I'll have to try my hand at trading commodities...
...Last October, I invested in a turbo fund called PBHG Growth...
...Out of fealty to Michael Milken I recently dropped some money into a junk-bond fund (yes, these supposedly evil tools are still around, and they're thriving...
...The only trace of liberalism I've discovered is a few "socially responsible" mutual funds that pledge not to invest in companies that are not "good corporate citizens...
...One of my fondest childhood memories is of opening the San Francisco Chronicle each morning and immediately turning to the sports section...
...In January, I received a statement informing me my initial investment had declined in value...
...Nonetheless, I can tell this is a hobby I'm going to have for a while...
...I've learned that while the fund's "load" matters, more important in the long run are its annual expenses and its capital-gains tax liability...
...What has all of this got me...
...The importance of diversifying one's portfolio means there's almost no end to the different kinds of fund one can justify investing in...
...And now it's worth even less, having dropped 10 percent just this year...
...Politicians have their solemnly labeled blue-ribbon commissions, fund managers their funds christened American Century Income Growth, Heartland Value, Pegasus Income, Strong Opportunity, Victory Growth, and my personal favorite, Rembrandt Value Trust...
...As best I can tell, mutual funds tend to be managed by egocentric, publicity-hungry, money-grubbing white guys...
...While these can be extremely volatile, when Hillary Clinton was asked how she turned her $1,000 commodities investment into $100,000 almost overnight, she cited her reading of the Wall Street Journal...
...I called the PBHGers to inform them this must be a mistake...
...Because even after conducting what I felt to be an enormous amount of research on the "best" funds for my portfolio and trying to stick with established companies like Vanguard and T. Rowe Price, I've still suffered...
...market shows signs of producing more PBHG Growth-like returns, I will look for international funds...
...But that shouldn't affect my returns, should it...
...Having once been a religious reader of Sports Illustrated, I'm now addicted to finance-oriented publications like SmartMoney and Morningstar Investor...
...I read the Journal, and I even used to work there...
...If the U.S...
...These days, I read papers that have no sports section or not much of one, and the statistics that provide my morning's thrills— or disappointments—are not RBIs and rebounds but something decidedly less youthful: mutual-fund returns...
...How many other spare-time activities involve making money (or losing it) with so little effort...
...It's an awful way to start the day...
...Reading about funds and fund managers whose sole mission is maximizing investment returns can be a welcome break from days mired in Washington's petty political disputes...
...Yet there are parallels between the fund world and the political world...
...You bought the fund at its peak," was the soothing reply...
...Somehow I've resisted these funds, though maybe investing in them wouldn't have been such a bad idea...
...Everyone involved seems to want a capital-gains tax cut, Philip Morris is a recommended investment, and meritocracy reigns supreme...
Vol. 2 • June 1997 • No. 38
