This isn’t my friend, but you get the idea.

“3 Things That Surprised Me When I Browsed 12,000 Mutual Funds”

How much do you know about your funds? My friend just sent this in.

Keywon
Keywon
May 26, 2016 · 5 min read

My team just launched Goodbye Gun Stocks. It is a website made for activism — it helps you find gun-related stocks in your mutual funds, and discover gun-free alternatives.

But turns out it is a good all-around fund screener, even if you don’t care about the gun issue. Now that I think about it, there really isn’t a user-friendly way to browse thousands of funds available in the US in one place.

After playing with Goodbye Gun Stocks and sifting through the sea of funds, a friend told me about the three things that surprised her.

“International” funds may not be so international after all.

Turns out many funds with “international” in their names still hold plenty of North American securities, most of which I can safely assume are US-based. Some examples with links for detailed info:

  • PID PowerShares International Dividend Achievers Portfolio: 46%
  • FIVFX Fidelity Advisor International Capital Appreciation Fund: 28%
  • MFAIX Morgan Stanley International Advantage Portfolio: 25%

Why should I care? Because you may not be as diversified as you thought.

How can I double-check my fund? By looking at the map icon under Fund Profile at GoodbyeGunStocks.com

In the age of free robo-advisors, mutual funds are still expensive.

That’s right. There are so many funds with high expenses, a 1.20% expense ratio falls into the mid-20% range. In fact, the average fee fore mutual funds is 1.25% according to Investopedia.

Gray = Distribution of all fund expenses in our database, excluding outliers

Here are some funds with very high (read: super-duper high) expenses.

  • MISEX Midas Magic: 3.31%
  • AMRGX American Growth Fund Series One: 4.38%
  • COPLX Copley Fund: 6.14%
  • KED Kayne Anderson Energy Development: 12.40%

Why should I care? Because fees can have a greater impact in your long-term profitability than many other factors.

How can I choose a low-fee fund? Limit your fund search to the lower fee range, using this slider:

There are more than 30 fund categories, including very adventurous ones

Everyone knows about large/mid/small cap. Most know about sector funds. But not many of us know that these exotic funds even exist.

  • SWHEX Schwab Hedged Equity Fund
  • SAOAX Guggenheim Investments Alpha Opportunity
  • NLR Van Eck Market Vectors Uranium + Nuclear Energy ETF
  • PHO PowerShares Water Resources Portfolio

Misc sector funds are probably similar to the topical investing Motif is after. And the topic-based ETFs Stash provides likely fall in this category.

I am more puzzled by the other two. Who uses these strategy funds, like fixed multiple and long/short? Why would one use this instead of doing individual stocks or derivatives? Do institutional investors use them?

Why should I care? “Invest in what you know,” said Peter Lynch. Is your money invested under strategies that you are comfortable with?

How do I browse all funds in a category? Here’s a link to all Misc Sector funds across all brands. Go to this page, and change the Fund Category to what strikes your fancy.

Goodbye Gun Stocks, Hello Comparison Shopping?

Elsewhere on Reddit, we saw users create lists of “worst funds”, and brag how they found lower-fee funds using the tool. Not related to gun stocks.

To be honest, we didn’t think users would respond to the fund screener aspect as much. We did what we’d do with any other data — show how each fund compares to others, and what the universe of funds look like.

Just like the app reveals gun stock % in all US funds, it reveals other metrics, like expenses, volatility, and returns, and users started to talk about it.

Distribution of gun stock % in all funds in our database

It’s strange that you can’t quite comparison-shop where thousands of dollars of your income go every year. You’d spend a lot more time researching when you buy a $200 gadget.

Wanna try a gun divestment tool that turned out to be surprisingly cool fund screener? Check out Goodbye Gun Stocks here https://goodbyegunstocks.com/ and let me know what you think!

Keywon

Written by

Keywon

Full-stack designer based in San Francisco and Seoul, Korea. Past: Cofounder of http://hellomoney.co, MIT @MediaLab, @IDEO Palo Alto, and @Microsoft.

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