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Funds 504: When to Sell a Fund

Introduction to When to Sell a Fund When to Sell: Your Fund Gains or Loses More Than It Should When to Sell: Your Fund Changes Its Strategy or Underperforms for a Long Period When to Sell: Your Goals Change or You Just Can't Take It Anymore Summary of When to Sell a Fund
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When to Sell: Your Fund Gains or Loses More Than It Should

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When to Sell: Your Fund Gains or Loses More Than It Should

This might sound illogical—after all, who complains about great returns? But if your "moderate" balanced fund posts a 60% return when its average peer is up 10%, maybe you don’t own what you think you do.

And on the other end ...

Suppose a bond fund loses more than 23% in a year in which its average peer suffers a much slimmer loss. That was the case with one fund in 1998, a multisector-bond fund that made a big bet on emerging-markets debt in general and Russian debt in particular. Shareholders who expected boring bond performance should have sold.