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Saturday, January 22, 2011

steps for evaluating international mutual funds

steps for evaluating international mutual funds ; International mutual funds are posting impressive returns and are a vital tool for proper diversification. If you want to add a fund to your mix of 401(k) investments, consider these four points:

Expenses.
Diversified international funds are likely to charge more than U.S. stock funds, but expenses shouldn't be unreasonably higher, said Gregg Wolper, a senior mutual fund analyst for Morningstar Inc. The expenses will range widely from actively managed funds such as the top performing Oakmark International (OAKIX), with a 1.1 percent expense ratio, to index funds such as the Vanguard FTSE All-World ex-US Index fund (VFWIX) at 0.35 percent.

Performance.
Check performance in good and bad years for the overall market. See how the fund you're considering did in 2008 and consider whether you're comfortable with that. "Don't just pick the fund with the best performance," Wolper said. "See how it performed in various market climates."

Emerging Markets.
See how much the fund has invested in emerging markets. Weigh your own level of risk tolerance with the fund's allocation to that segment since emerging markets carry significantly higher risk than developed countries.

Management.
Look for an experienced manager. For the latest updates PRESS CTR + D or visit Stock Market news Today

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