When fund firms tell investors they should not use past performance as an indicator for future results, they should believe it, said Andrew Clark, a senior analyst at Lipper.

When trying to choose an index-beating fund, a recent Lipper study finds that for both open-end equity funds and taxable bond funds, there is generally no difference between using low expenses as a screen versus choosing based on strong three-year returns.

Subscribe Now

Access to premium content including in-depth coverage of mutual funds, hedge funds, 401(K)s, 529 plans, and more.

3-Week Free Trial

Insight and analysis into the management, marketing, operations and technology of the asset management industry.