Do Mutual Funds give returns of 35% to 45% when they say?

WHen Mutual Funds advertise that their past annual returns have been 35%, does it mean that you actually got 35% of your investment as return after one year of investment?

Does Equity funds have risk of loosing money or just risk of not making profit?

8 Replies to “Do Mutual Funds give returns of 35% to 45% when they say?”

  1. The funds are picking the timeframe they choose in order to show the good rates. A few small amount of mutual funds even outperform the stock market indexes – some of that due to the fees they might charge.

    Equity funds are stock funds and can move as wildly as the market moves. They are traditionally long-term investments which then reward in more predictable results. However, the day to day price and even the whole market can swing an equity fund price drastically.

  2. i would stay away from mutual funds.

    THey have hidden fees with them that i have never liked.

    I would certainly stay away from soemthing that says 35% or more return, THat is WAY out of the ordinary, like probably 1% of mutual funds will do that good, some will even lose 35%

  3. times have changed….you have to get in and out at opportune times or you get negative. If you don’t want risk, get FDIC or buy bonds. But don’t expect 35% either.

  4. Mutual Funds are highly regulated…… but all your money is at risk. Funds that have earned 35% or more in a year or averaged 25% or more for the past 3 years may be the last funds you want to get into now.

    So…. if a fund has a 3 year average of 25%… that means the average for each year was 25%. That could be 35% year 1, 10% year 2 and 25% year 3………..

    You need to get a book or two on mutual funds. The basic reason…… you should never invest in anything you don’t fully understand. You should never chase performance (last years winners often turn out to be this years losers.

    Technically any fund can go to $ 0.00. Very (very) aggressive funds can lose 35 -75% in one year.

    Learn about “asset allocation”. Using a model made by you, for you…….. is the best way to go. READ READ READ, LEARN, LEARN, LEARN…….. Take the time, it will be well worth it.

  5. Investments all have a chance of losing money. Funds sometimes do have a year or several years of returns of 35 % or even more – and many can lose that much or more. Real Estate and Energy Funds had a few years with those type of returns – Real Estate funds are not doing so well the last year or so – losing double digits.

    It is a fools bet to buy a fund because it had a few good years. It is usually because it wasn’t diversified e.g. like Real Estate, Energy, Technology, emerging markets etc. When you buy you will be buying at the top and most likely they will not give you the same return or will drop down to give you a loss.

    You need to have a well diversified investment of large, small and foreiqn stock and bonds and maybe a small amount of real estate, energy or other narrow focused funds. Over the long run you should get a healthy return without hugh gains or losses in any given year.

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