Closet indexing is when a Mutual Fund goes against their mandate and buys individual stocks inside an index even though they are supposed to be selecting companies non-correlated to the index. This allows them to match or marginally beat the funds performance. This allows them to claim they are performing well enough to deserve your money. The video below is quite revealing and should bring to bear the entire premise of how you select who manages your money.
http://insider.thomsonreuters.com/link.html?ctype=group_channel&chid=3&cid=156510&shareToken=MzphNjgxMzRmMi0wYWVhLTRjNGUtYTJkOC05ODA2ZTVkOWM3OGU%3D%0A&playerName=ReutersNews
No comments:
Post a Comment