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and there lies the rub: How do you know which fund managers will "manage" the funds better? Attempting to pick mutual funds on the basis that the fund manager has performed well in the past is a bad idea. (>90% of funds that have outperformed index funds for three or more years, will loose money over the coming years)
BTW, I put very little stock in the diversity arguement. There are just as many flavors of index funds out there that are as there are mutual funds. Hell, even if you just take an index fund based on the S&P 500, you're pretty well diversified.
[Edited by troysvihl on 12-05-2000 at 04:12 AM]
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