Not Clear That Mutual Funds Are Becoming More Tax Friendly

This is the time of year when mutual funds make their annual distributions. The distributions, in this case, involve capital gains and ordinary income. They are the profits realized by the funds, most commonly through the sale of their portfolio’s holdings. To the extent that these gains cannot be offset by losses, they are passed…

 

The Earnings Quality Indicator Used by ETFs

Look under the hood of exchange-traded funds (ETFs) incorporating a quality factor and you will often find accruals being used. An accrual is an accounting entry recorded at the time a transaction occurs, regardless of whether not payment has been made. Accrual accounting allows businesses to report their sales and earnings performance without being beholden…

 

Notes From the Morningstar Investment Conference

This week, Morningstar held its annual Investment Conference. Attended primarily by financial advisers, the conference is notable for both its size and its mutual fund focus (though there were sessions on other topics). This week, I’ll share some of my notes and observations. You’ll see a few articles resulting from meetings I had at the…

 

A Gold Fund’s Debacle Highlights Risks

Any time a fund invests in something more esoteric than exchange-listed stocks from a developed country or widely traded high-quality bonds, the potential for something to go wrong increases. We saw this happen in December when the Third Avenue Focused Credit Fund—a mutual fund—suddenly shut its doors in response to junk bond losses. Last week…

 

AAII Investor Update: Protecting Your Digital Assets

A part of the process for managing your finances that is easy to overlook is protecting your digital assets. Not your online persona (e.g., “Fly Fishing Bill”), but your records, statements, passwords, etc. Computer viruses, malware and identity theft are certainly concerns to take action on, but so is protecting your files containing your financial…