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Choosing Mutual Funds- The Single Most Important Thing

Growth Funds, Income Funds, Value and Balanced Funds. How aggessive do you want to be? How do You chose? Why do they say the average person is always wrong? What exactly is a fixed income fund? Who’s advice do you take?

In choosing mutual funds there is one single most important thing.

But before I get to that let me tell you how most people do it. You may have done this. At first glance it makes sense. You look for or search for the “best” mutual fund with the best track record. You want to invest in what did great last year. Don’t we all want to invest in winners? But this is the exact opposite of what you should do.

In choosing Mutual Funds the single most important thing is the asset you invest in. I have a video teaching all about mutual funds and asset classes at The asset class is the critcal decision and and which asset class to invest in changes with various economic situations.

Therefore, if large cap stocks do well one year they may not do well the next year. If bond funds do real well for a while it is probably because interest rates have been declining. After interest rates decline for a number of years during a recession, they might then rise for the next few years as the economy recovers and certain bond funds will decrease in value. When the tide comes in all the boats float.


If you want to buy low and sell high you have to buy assets nobody else wants and the news says are bad, and you have to sell when everybody else wants to buy. However, with that said it is not that easy. One of the best explanations of cycle analysis and asset clases is the work of George Dagnino who writes the Peter Dag Report at Now you know, when it comes to cloosing mutual funds the asset class is the single most important thing.

Disclosure: none