Investors in mutual funds are increasingly turning to accounts with multiple managers, even though that means paying higher fees, The Wall Street Journal reports.

Accounts with multiple managers grew to $678 billion last year, an increase of 28%, and are expected to rise another 14% this year, according to the Boston-based research firm Cerulli Associates. But higher fees, typically 2% to 3%, and not-so-great performance still make them a questionable buy. Maybe investors just don’t trust themselves.

"Investors increasingly want to hire someone else to do the fund picking for them," said Ben Phillips, a Cerulli managing director. "Advice has become more popular with investors worldwide. Multi-manager funds have advice embedded into the product."

Funds-of-funds, which are mutual funds that buy into other mutual funds, and manager-of-managers funds, which are funds that employ different managers to oversee different aspects of portfolios, have become increasingly popular. But according to Morningstar , their performance has not exactly gone parallel to their popularity. International equity funds-of-funds returned an average of 4% over the past three years, trailing international equity single funds, which came in at 5.3%.

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The staff of Money Management Executive ("MME") has prepared these capsule summaries based on reports published by the news sources to which they are attributed. Those news sources are not associated with MME, and have not prepared, sponsored, endorsed, or approved these summaries.

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