I read an excellent online post yesterday from LA Times money blogger, Tom Petruno.
Long story short - Petruno showcased a report that stated many mutual fund managers DO NOT INVEST IN THEIR OWN FUNDS.
"Chances are your mutual fund manager doesn't eat his own cooking. A new report from Morningstar Inc. looks at fund managers’ personal holdings of the funds they run, and concludes: "The number of managers showing no faith in their process is staggering."
In other words, relatively few managers invest alongside their shareholders. Too often, a fund may be good enough for you, but not for a penny of your manager’s own money."
But the fund manager is allegedly the 'expert'. If the expert doesn't have confidence or see value in their own fund, how can they expect others to invest?
It's like sitting down at your favorite restaurant and overhearing the head chef say, "Are you joking? I wouldn't eat this slop in a bazillion years!"
You can read Petruno's entire post here.
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