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Island Investing

Riffs, rants, and the upside of investing from way off Wall Street


This Week’s Sign the Lunatics Are Running The Asylum

Presented without commentary.

Losing Mutual Funds Still Enjoy Big Paydays.
Despite 2008 decline, some fund giants garnered more than $300 million in fees

Many mutual-fund investors suffered heavy losses in 2008, but managers of some of the largest stock funds – including ones that fell roughly 40% in 2008 – gathered hundreds of millions of dollars in fees during that time.

And later on:

[Morningstar analyst] Dolan also suggested that the dollar amount brought in by fees be expressed in terms of total returns delivered by a fund. For example, if a fund’s returns in a year amounted to about $600 million, and it realized $300 million in management fees, investors would have a clear picture of how much fees affected returns.

The entire article is here.