Mutual Fund Evaluation and Upgrade – A Simple Five Step Process

Expert Author Keith Maderer

There are so many mutual funds out there and so much information to help you, that it can be confusing or overwhelming. But if you want to make a quick evaluation along with periodic upgrades to your portfolio, just follow these five simple steps.

Your Five Step Evaluate and Upgrade Process:

Step 1: Visit the Morningstar Website: There is a free section that will allow you to look up and see a great deal of information about any fund that is available to the public. You should sign up for a free log-in account by giving your email address and some basic information.

Step 2: Set Up a Personal Portfolio or Watch-list: After logging in, find the portfolio tab at the top of the page and select the create tab to start a new portfolio or watch list. Enter all of your existing fund ticker symbols into this watch list, give it a name and then click the SAVE button.

Step 3: Evaluate Your Funds: There are several different portfolio views you can select, I usually make up my own under “my views”, then pick and choose the data that is important for me to follow. You can do the same and choose from a wide variety of criteria. Now you are ready for some direct comparisons.

Step 4: Screen With Morningstar: Use the free fund screener tool, under the funds tab, to find the best performing funds within your fund investment objective or fund category. You select the criteria that you want to screen and it will sort them accordingly.

Step 5: Select and Upgrade: If your fund is in the top ten over the past three and five years, leave it alone. If not select the best no-load fund in the group and add it to your portfolio. If you have a larger portfolio, you may want to select two of the top ten and split up your investment dollars. Make sure to add any new funds that you purchase or like to your watch list for future evaluations and upgrades.

Summary: This is a very simple way to keep your mutual fund investments working the way you want them to. It will also help you to weed out the laggards and strengthen your overall portfolio. You should perform this process on a quarterly basis, but don’t get too worried if one of your funds falls off the charts for a quarter. If it remains off the charts for a few quarters, it is probably time to find a replacement.

To discover additional investment, financial and income tax strategies, check out my blog or download your FREE Wealth Expansion Kit by clicking here. The first step to creating wealth is knowing where you are and then charting a path that will enhance your financial strengths and correct your weaknesses.

Keith Maderer is a financial expert and has been a investment and tax adviser in the Western New York area for over 30 years. He is the owner of SENIOR Financial and Tax Associates and the founder of the Maderer Foundation, a private scholarship program.

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