Sunday, March 02, 2008

Are you holding a lemon?

It seems there is about £20bn invested in popular funds that have been seriously underperforming. These funds have produced below average returns against it peers in the smae fund sectors for the last consecutive 3 years.

Please check the list to see if you are one of the investors in these funds and look around for a better performing fund to switch to. Keeping your investments in these funds is tantamount to throwing your money down the drain. In the long run, it will not appreciate and you might even find your capital eroded by the low returns and the effects of inflation.

Chelsea Financial Services has identified more than 100 unit trusts and open ended investment companies that are serial failures of the which the largest 5 with over £9bn invested in them are:

• Halifax UK Growth
• Scottish Widows Corporate Bond
• Liontrust First Income
• Axa Equity Income
• Jupiter Distribution

A full list of these underperforming funds can be found at www.chelseafs.co.uk/relegationdivert

If you are holding any of these, you might like to switch to a better performing fund within and ISA supermarket so that you don't pay the expensive transactions costs. If you hold these funds outside of an ISA and don't want to invest in funds for a while, a really good alternative is to select one or a few ETF. These all have very low entry costs and are normally based on an index. This way you will get market performance and won't have to pay any management fees.

Read more on these topics on the www.Investment-Training.com website.

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