Monday, January 22, 2018

Does your mutual fund work for, or against, you?*

After about a decade preferring direct investments in stocks to local mutual funds, I joined tens of thousands of T&T citizens in making investments in three mutual funds last year—mainly because of the monthly deduction to acquire units by standing order, the diversity of assets under management, the ability to dollar-cost average, the benefits of compounding and dividend reinvestment. But T&T’s mutual funds are not exactly paragons of investment virtue.
One indication of this is the fact that the total funds under management at local mutual funds only increased by 16 per cent between June 2008 and June 2017, from $36.8 billion to $42.7 billion, according to Central Bank’s November Monetary Policy Report and its Annual Economic Survey for 2011.

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