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Thursday, February 17, 2011

Performance of 5 Most Widely Held Mutual Funds-AAII

The table below shows the performance (through the end of 2010) of the 5 most widely held no-load or low-load mutual funds as reported by the American Association of Individual Investors. I have added expense ratios from Morningstar. Two of the funds of the top 5 are index funds - in fact, the 6th largest fund was the Vanguard S&P 500 Index fund.
New entrants into the labor force who started work 3 years ago came into a great environment. They started contributing to their 401ks at severely depressed stock prices throughout 2008 and early 2009 and picked up stocks on the cheap. That's the good news. The bad news is that because they were starting out they didn't have much invested and most weren't contributing much  :)
Those who were within 3 years of retiring and were pouring funds into the market and taking advantage of 401k catch up features did well. Those who retired exactly 3 years ago went through a rough period. It is why decumulators need to plan on how to draw a paycheck off their nest egg.
Source:AAII Journal Vol. XXXIII,No.2/Morningstar


  1. Another thumbs up for index funds!

    And Jeopardy confirms it computers beat human!

  2. The Index funds did pretty well, but Will Danoff at Contra and the folks at Dodge and Cox are darn good money managers and tough competition.

  3. @MoneyCone It is clear to me that the message on indexing is getting through to investors. You've reminded to go to Grouch's site and watch the computer vs. humans Jeopardy videos!!
    @Grouch I kinda like the Fidelity contra fund and keep it when I take over management of accounts. I blow everything else out and index it. The contra fund fits in with the fundamental indexing I posted about last week. It seems to counter a bit the market cap weighting of most index funds. At least that's my take.

  4. Robert--- You should definitely watch the Jeopardy videos. I'm a computer geek and what those guys at IBM did with Watson is a mind-blowing accomplishment.... one more step down the road to science fiction.

  5. @The Grouch - I heard about Watson. Sounds pretty amazing!