Moneyspider in the News

Opportunity costs

What Investment 

Being in the wrong fund can costs investors £30,000 in missed opportunities, according to moneyspider.com, but advisers warn that investors need to be aware of making crude comparisons. 

The website pointed out that picking the right sector is crucial. It used the example of Invesco Perpetual's Latin American Fund, where an investor putting £5,000 in the fund in November 2002 would today have made a profit of £31,035, compared to just 230 in the firm's North American US Equity fund. 

However, Donna Bradshaw, an adviser with IFG, says, 'Comparing past performance of different geographical sectors isn't a good idea. The North American economy is shot to bits, whereas Latin America has performed well, but is considered more speculative. You need to look at more than just past performance. You need to look at funds that are appropriate for the individual needs and risk profile of each investor.' 

She agreed that each fund should be assessed on its own merit, rather than going on the reputation of the fund management firm alone, but Bradshaw said this should be just part of a broad portfolio of analysis. 

Moneyspider.com director Tony Ahearne concluded, 'You can't except your fund manager to tell you which funds are dogs even if that's where your money is invested. It is essential that investors take personal responsibility for monitoring the performance of their funds on a regular basis.' 

For further details of the survey visit www.moneyspider.com