Performance Is Back

Physician's Money Digest, September30 2003, Volume 10, Issue 18


A red flag to watch out for whenyou're searching for mutual funds is onethat trumpets past performance. Withthe market on an upswing, some fundsthat had switched to image advertisingduring the bear market are now beatingthe drums about their short-term gains.The problem, many market observerssay, is that short-term performance is nota very reliable gauge of how well a fundwill do over the long haul. For an industrythat is supposed to encourage investorsto think long term, critics say, anemphasis on short-term results sends amixed message. Look at 5- and 10-year results for a better idea of how wella fund has performed.