Fund Investment Qualities
  1. Overview Of The Mutual Fund Industry
  2. History Of The Mutual Fund
  3. How A Mutual Fund Works
  4. Today's Mutual Fund Industry
  5. Fund Investment Qualities
  6. Fund Investment Quality Scorecard (FIQS)

Fund Investment Qualities

By Richard Loth (Contact | Biography)

Investment research firms use data provided by the fund sponsor to generate a variety of analytical perspectives. These are used by professional and non-professional investors in selecting and monitoring mutual funds. For funds that are publicly traded and the object of significant investor interest, this information is distilled into fund research reports. These are available to the investing community through a number of services such as Morningstar and Value Line.

The content of such a report is comprehensive, containing dozens of data points, ratios and informational perspectives that reveal the investment quality of a fund. To make things simple for the average investor, we'll take this abundance of information and focus on eight fundamental indicators of investment quality. An investor can use this perspective to make intelligent decisions on whether to buy, sell or hold a mutual fund.

These eight evaluative fund investment qualities are listed below. Subsequently, you will find in-depth discussions of each of these investment quality indicators, including where to find them, what they mean and how to use them). Armed with this know-how, you will be equipped to make informed mutual fund investment choices.

  • Fund I-Q No.1: Investment Style Considerations
  • Fund I-Q No.2: Risk-Return Profile
  • Fund I-Q No.3: Fund Size and Style Compatibility
  • Fund I-Q No.4: Manager Tenure and Structure
  • Fund I-Q No.5: Portfolio Turnover Ratio
  • Fund I-Q No.6: Fees and Expenses
  • Fund I-Q No.7: Comparative Total Returns
  • Fund I-Q No.8: Analytics
The Fund Investment Quality Scorecard (FIQS) is a tool to record your findings on a given mutual fund. We've avoided suggesting the use of any type of quantitative ranking with the scorecard, preferring instead that the investor use his or her best judgment to arrive at a qualitative "score."

A fund does not have to be perfect in all aspects to be top rated. For example, what we are looking for is a fund that has a composite investment quality score from above-average to high. Completing a scorecard will be relatively easy once you learn how the system works from the instruction provided herein. A little experience and some common sense will serve you well.

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Fund Investment Quality Scorecard (FIQS)

  1. Overview Of The Mutual Fund Industry
  2. History Of The Mutual Fund
  3. How A Mutual Fund Works
  4. Today's Mutual Fund Industry
  5. Fund Investment Qualities
  6. Fund Investment Quality Scorecard (FIQS)
  1. Benchmark

    A standard against which the performance of a security, mutual ...
  2. Qualitative Analysis

    Securities analysis that uses subjective judgment based on nonquantifiable ...
  3. Alpha

    Alpha is used in finance to represent two things: 1. a measure ...
  4. Profit and Loss Statement (P&L)

    A financial statement that summarizes the revenues, costs and ...
  5. Liquidity

    The degree to which an asset or security can be quickly bought ...
  6. Equity

    Equity is the value of an asset less the value of all liabilities ...
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