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Fundology: The Secrets of Successful Fund Investing

Book Description

Owning an investment fund is the easiest and most convenient way for investors to put their money to work in the world's financial markets. Yet only a handful of people really seem to understand how to make the most of the opportunity that funds offer. Too many pick the wrong fund in the wrong market at the wrong time - a sure-fire recipe for disappointment. In this important new book, an award-winning manager at one of the UK's best fund management firms explains in simple language what it takes to buy and sell investment funds successfully - and how to avoid the common mistakes that so often condemn fund investors to poor results. John Chatfeild-Roberts, head of the fund of funds team at Jupiter Asset Management, is responsible for sifting through the thousands of funds that are open to UK investors and hand-picking the best 10 - 15 for his clients' portfolios. The Jupiter Merlin range of funds has won a string of industry awards for their consistent performance. Now, in Fundology - The Secrets of Successful Fund Investing, he explains in detail how to set about becoming an expert fund investor - what to do and (just as importantly) what not to do. While he concentrates on unit trusts and open-ended investment companies (OEICs), his specialist area, many of the principles outlined here apply equally well to other types of fund. The topics covered include: - Why funds are worth considering - How unit trusts and OEICs work - How to pick the best managers - The truth about costs - The trouble with index funds - Which funds the Jupiter team own (and why) - The most common mistakes that investors make Easy to read and outspoken in places, Fundology is a must read for anyone interested in knowing how to get the most out of their investments. Knowing how the experts go about choosing funds can only increase your chances of improving your own success rate.

Table of Contents

  1. Cover
  2. Publishing details
  3. About the author
  4. Disclaimer
  5. Preface
  6. 1. Introduction
    1. The basics of investing in funds
    2. Plenty of choice
    3. What you need for success
  7. 2. The fund concept
    1. The idea behind funds
    2. Diversification and risk
    3. The advantages of scale
    4. The returns you can expect
    5. Points to remember
    6. 3. How funds work
    7. The importance of detail
    8. The range of funds in the UK
    9. Unit trusts in more detail
    10. The scheme particulars
    11. The legal position of fund investors
    12. OEICs and unit trusts
    13. Dual pricing in action
    14. What buyers pay
    15. What sellers receive
    16. The pricing of OEICs
    17. Points to remember
  8. 4. Growth or income, or both?
    1. General principles
    2. Income or growth?
    3. Inflation and retirement
    4. Capital appreciation has attractions too
    5. Timeless truths
    6. Points to remember
  9. 5. How to pick the best fund managers
    1. Keep it simple
    2. The qualities you need
    3. Learning from experience
    4. Finding the best
    5. Experience is important
    6. Talking to fund managers
    7. Assessing people is an art in itself
    8. Points to remember
  10. 5. What can past performance tell you?
    1. Mirror, mirror on the wall
    2. A trail of clues
    3. Example of BARRA output
    4. A short cut to style analysis
    5. The dangers in past performance
    6. Other interpretation problems
    7. Enter the regulators
  11. 7. The truth about costs (and index funds)
    1. Do costs matter that much?
    2. Too little competition on price
    3. A more logical state of affairs
    4. The fund of funds example
    5. What about index funds?
    6. The trouble with indices
    7. Active managers can win
    8. You still have to make decisions
    9. Conclusion
    10. Points to remember
  12. 8. Asset allocation and managing risk
    1. What does asset allocation really mean?
    2. Don’t be too rigid
    3. Keep yourself informed
    4. The trouble with weightings
    5. Whose risk is it anyway?
    6. Are absolute returns the answer?
    7. Living with volatility
    8. Points to remember
  13. 9. Jupiter Merlin in action
    1. What the fund does
    2. The fund of funds concept
    3. Jupiter Merlin Growth Portfolio Fund Holdings as at 31st October 2005 (names of managers in brackets)
    4. UK investments
    5. Opportunities overseas
    6. The potential in Japan
    7. Specialist holdings
    8. How the fund has changed
    9. Points to remember
  14. 10. The secrets of success
    1. The need for humility
    2. The lessons of youth
    3. Look at the valuation
    4. Think for yourselves
    5. Liquidity matters
    6. Mistakes we all make
    7. Final thoughts
    8. Points to remember
  15. Glossary
  16. Acknowledgements & thanks
  17. Appendices
    1. What is in the appendices
  18. 1. Jupiter Merlin Portfolios, November 2005
  19. 2. Graphs of all the index-tracking unit trusts and OEICs
    1. 3. All Jupiter Merlin Growth Portfolio Fund Holdings