Alternate title: Why I'm an idiot
Prepare yourself, gentle reader, for a shock. I'm about to show you the performance chart of what, for all intents and purposes, is the worst mutual fund in the history of the known universe:
That blood-curdling scream you just heard was me, after I realized I own this turkey and subsequently jammed a spoon into my eye. See the massive spike in 1999? I missed that. See the parabolic peak in 2000? That's when I bought. See the widowmaking ski-hill slope that was the year 2001? I got all of that, and then some. Astute readers will note the complete and absence of activity in either direction since then.
Perhaps a little back story is in order. This particular affront to wealth management was a gift from my dear old dad. He put $1000 into an RRSP in my name before I was wise enough to care about such things, and he decided to put the lot into something called an "e-business specialty fund". I can't remember the specific time frame, but as far as I can tell, this chain of events was set in motion about 14 seconds before the tech bubble burst in 2000.
But wait, there's more. Not only is my $1000 now worth something in the neighbourhood of $180, but thanks to a fat 3% MER, I'm actually paying the fund company more than five bucks a year for the privilege. My favourite part? The company describes the fund as "extremely volatile" which amuses me to no end -- I mean, it not volatile. It was volatile for about two years. But it's been a model of consistency since about 2003. Consistently flat, that is.
I can already hear your howls of protest about why holding on to an expensive, underperforming mutual fund like this goes against everything I stand for. But honestly? I can't bring myself to sell it. I mean, how do you even cash out $180 worth of mutual funds? From where I stand, I can actually see an advantage to keeping it -- forcing the fund company to spend money to send me quarterly reports until the end of time seems like a suitable punishment for their crimes.
All jokes aside, I do plan on divesting the fund as soon as I can get around to it. But I might just hold on to it and conduct some sort of perverse psychological experiment, where I can open up my portfolio statement in 50 years time and see that my $1000 investment is finally worth $800 again. Just don't you dare mention the word "inflation" to me.
Showing posts with label MER. Show all posts
Showing posts with label MER. Show all posts
Thursday, May 31, 2007
Mutual fund companies should be ashamed of themselves
Posted by
GIV
at
3:30 PM
3
comments
Labels: MER, mutual funds
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