Another reason why managed funds are not “set and forget”

Nine former Suncorp investment managers, the Australian Equities team, have walked out the door to a competitor. Should you care? (Read the news item here.)

So often people recount stories to me that how they identified their managed fund was based on past performance. They also say they did lots of research when they first invested but in the intervening years have done little more than check the balance.

You’ve probably heard that past performance is not indicative of future performance – but I often sense that people see that statement as a legal escape clause for the marketer rather than having much basis.

Well, if the entire team managing your money has changed (usually to different jobs) then there’s a good likelihood that future performance may be different to past performance.

Industry researchers van Eyk Research identify the capability and stability of senior investment staff as a key factor in the quality of the managed fund. In modern society it is common that we change jobs every few years and the same happens in financial services, including in funds management. So it is important for you to keep an eye on the ongoing performance of the team managing your money.

Investing, even in managed funds, is not a set and forget game. You need to nurture your wealth.

Author: Matt Hern

Certified Financial Planner professional, Matt Hern has three times been awarded as one of Australia's Top 50 Financial Planners by The Australian Financial Review Smart Investor. He is passionate about guiding you on the right financial choices to achieve what you really want. Matt Hern is an Authorised Representative of Charter Financial Planning Limited AFSL 234665. All information is general advice only.