Mutual Funds 101

When you’re in the market for a mutual fund, says Marshall Loeb in MarketWatch, how do you choose the right one from the hundreds available? The first thing to look at is your timeline. If you’ve got 20 years before retirement, go ahead and consider “a more risky sector like emerging markets.” If not, seek out a more conservative fund. The prospectus will tell you about the risk level of the fund and the sectors it invests in. And when looking at specific funds, cut through the “marketing lingo” and hone in on “three important factors: performance, management, and consistency.” An independent research firm like Morningstar will help you find “a well-managed fund.”

Why firms leave the U.S., and why it doesn’t help

“It has become received wisdom,” says Floyd Norris in The New York Times, that the Sarbanes-Oxley Act made the U.S. less competitive and drove companies overseas. “But do the facts support that wisdom? No.” A new study shows that the companies that fled the U.S. did so because their slow growth and poor market performance made them unable to raise capital here. And among those with good growth prospects, there’s evidence that “the market punished companies that decided to leave” the umbrella of American regulation. Why? There is still a premium for listing your company in the U.S., because investors still have above-average faith in U.S. accounting and disclosure rules. At least for now.