|
|
|
|
Many mutual funds are permitted to buy foreign stock issues as part of their charter. Sometimes, because of overseas market fluctuations, the closing price of those stocks can be inaccurate. Market timers will attempt to use that information and the ability of the fund to set it's net asset value (NAV) correctly. Market timers can take profits from the pockets of fellow shareholders, buying for profits and selling on losses. Fair value, an attempt at the industry to correct this problem without really stepping on the toes of market timers and trying to protect the everyday Joe who puts a little of his check away each week in his retirement 401(k) plan.
The problem lies in the method. It relies on judgment calls, something managers whose fees are based on assets are not likely to do with any real success. Recent stats published by ITG charted no noticeable gain for the investor either way but provided a way for both types of investors to remain in the market. [ Close Window ] This site and all its contents are copyright 1998-2004 by Paul Petillo/Editor/BlueCollarDollar.com. All Rights Reserved. |