Value Ratings: Mutual funds

There are thousands of mutual funds vying for your investment capital. Several considerations matter to you, such as:

  • Risk level
  • Historic returns
  • Tenure of current portfolio managers
  • Investment fees
  • Tax efficiency

The Challenge

You know that some considerations are more important than others are, but saying precisely how much more is difficult to do. A rating organizations has declared a handful of funds as having “gold star” status– but you have no idea how heavily they weight considerations that are of little relevance or importance to you. There is something peculiar about such declarations, because they seem to suggest that the best fit for one is the best fit for all. You think there must be a better way.

The Solution

After taking the preference survey, your Preference Profile reveals exactly how important each consideration is to you. When combined with actual performance data, you obtain tailored Value Ratings that display how well each fund performs in the areas that matter most to you. Your Value Ratings offer more than basic rankings. For example, they tell you if there is one or two outstanding mutual funds, or perhaps if all the funds cluster together in a mediocre range.

Viewed through your Preference Profile, this complex decision is made simpler

mutual funds

In this example, we see that Fund D is a strong performer. Following notable performance by Funds G and A, performance drops off substantially. Moreover, we can compare the best Value Rating (82%) to the worst (17%) to understand that there is a nearly a five-fold difference between the available choices. These are your results. Value Ratings for other people will differ because their underlying preferences differ.

And when decisions are especially consequential, Value Ratings offer additional guidance: Evidence Strength.  Evidence Strength tells you when you are witnessing reliably high performance.