A recent paper by a group of three finance professors backs up with fact what many have suggested for years:  too-fluid mutual funds cost investors more than they gain, according to The New York Times. The study, entitled “Does Motivation Matter when Assessing Trade Performance? An Analysis of Mutual Funds,” examines four model funds—each based on manager motivation—using performance data between January 1980 to December 2003.

Gordon J. Alexander, of the University of Minnesota and colleagues from the College of William and Mary, Scott Gibson and Gjergji Cici, aimed to prove that managers’ motives for buying or selling certain stocks affects the funds’ long term performance. 

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