Grab 'em While They're Hot

August 1998
Journal of Financial Planning;Aug1998, Vol. 11 Issue 4, p13
Academic Journal
The article reports that new mutual funds, particularly small-cap funds, tend to outperform more mature funds, according to two 1998 studies. This goes against the standard advice of sticking with funds that have been successful for at least three to five years. Of course, the performance gap narrows, especially after the first year, and according to at least one of the studies, the higher performance was due to higher risk-taking. The studies were done by the Charles Schwab Center for Investment Research and the Kobren Insight Group, a money manager and newsletter producer.


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