Mutual Fund Question...?

I am thinking about opening a mutual fund from my bank and these are some number...can you tell me what they mean?

Expense Ratio1 Before Reimbursement: 1.66%
After Reimbursement: 1.66%
Lipper Category Expense: 1.78%
Morningstar Fund Category: Diversified Emerging Markets
Funds in Category: 210
Overall Morningstar Rating鈩? 2 stars
Newspaper Listing: EmgMkt
Lipper Category: Emerging Markets Funds
NAV: 2 = $23.19

Total Return:
Year to date: -8.94%
1 year: 22.33%
5 year: 31.03%
10 year: 11.16%


What do all of those things mean? Is this a good fund? What is your opinion on this?

USAA Emerging Markets Fund (USEMX)


Growth potential from foreign stocks.
Diversified investing in less developed or rapidly changing countries.
In-depth research seeks companies with improving prospects and promising futures.

The expense ratio means that the fund charges you a fee of 1.66% of assets to pay for the fund's operating expenses. This is automatically deducted from your investment. That is slightly below the average of 1.78% for similar funds.

Emerging markets means that it invests in countries with less developed economies. It is a fairly risky fund. You can potentially makes some good returns but you can also potentially incur some big losses. You should only invest long term money in this and only if you are willing to accept significant risk. Otherwise, pick a fund that invests in developed countries or in domestic stocks.

Two stars means that its risk adjusted return as calculated by Morningstar is not very good. It's near the bottom compared to similar funds.

The NAV is the net asset value. For an open ended fund, this is the price per share before any sales charges.

Total return is the measurement of the fund's performance. It has lost 8.94% since January 1 and averaged a gain of 11% annually for the past ten years.

Is it a good fund? Frankly, no. It's not difficult to find an emerging markets fund that performs much better than this. I recommend against bank mutual funds because many of them have high fees and mediocre returns. For example, Fidelity Emerging Markets has an expense ratio of only 1.11%, a 5 star overall rating, a 1-year return of 28.02%, a 5-year average return of 35.06%, and a 10-year average return of 13.8%.

I'm not sure about all of the numbers, but here's what I can tell you.

Morningstar ratings are on a 1-5 scale, so this fund is in the middle/low end. FYI - Morningstar evaluates tons of funds on all sorts of things like amount of return, stability of the fund, potential, etc.

It is an Emerging Markets fund. Many of these have been successful over the past 2 or 3 years. However, emerging markets is a very volatile investment category. As you can see from the Total Returns, it has made on average 31% per year over the last 5 years. Emerging markets funds, however, can easily lose that much over the next 5 years. They can be very unpredictable.

It doesn't appear to be a bad fund, but it's not someplace that you want to put all your eggs. A small investment to balance your portfolio is fine.

Does not look impressive. Check out T. Rowe Price or Vanguard no-load funds.

That expense ratio is very high compared to other funds that are out there. It doesn't sound like much 1.66% but if you're investing in it for 20 years then it can add up to tens of thousands of dollars that could have been yours working for you. The only time an expense ratio this high is justifiable is when the fund has consistently outperformed the averages. The 10-year figure there is only slightly better than the average of 8 to 10 percent market average which may or may not continue in the future. Other fund companies have Emerging Market funds with varying expense ratios and and fee structures (i.e.,fees on purchases and sales). I would check Vanguard, T.Rowe Price and Fidelity first. Bigger firms can offer lower expenses than bank-run funds. Good Luck!

forget about expense ratio's and the other crap. The only thing that matter is total return and the investment sector
"Emerging Markets Fund" in less developed or rapidly changing countries. China, Malaysia, India, South America Africa, Vietnam etc see the trend?
Return year to date -9%, but look at historical 5 year +31% annual.

So the question is how much risk will you accept? If this fund loses 1/2 its value in a year, what would you do? But the reward can be excellent. I am about 1/3 invested in emerging markets

This mutual fund does not look impressive at all. It has an expense ratio of 1.66%, much to high for my personal tastes.

I am no longer a mutual fund supporter. There was a time when they were solid investments. About 75% of all mutual funds under perform the market. All of them have management fees, and some of them have sales loads.

You might look at ETF's, they are similar to mutual funds but have lesser expenses on average.

The best performer in my portfolio over the past 15 years has been my DRIP Plan.

They are seldom talked about because brokers make very little money when they suggest them. Yet, they have proven to be one of the best, if not the best, long-term strategy on Wall Street.

The best part is you get solid annual returns from well-known, safe Blue Chip companies like: McDonalds, General Electric, Pfizer, Walmart, US Bancorp.......etc........

They are inexpensive to start and maintain, and your dividends are reinvested for free.

They are perfect for small investors, as well as big investors. They are safe and allow you to not care about whether the market is going up or down.

Ask your parents what they think before you invest your money.