The Investment Funds Standards Committee, which represents all major distributors of mutual fund performance data, has reached a groundbreaking agreement to standardize fund categories.

The accord is intended to provide clearer information on performance rankings and to eliminate the jockeying for marketing advantage that has frequently occurred as a result of funds being placed in categories to which they do not belong. For instance, the committee imposed diversification criteria to prevent funds that are heavily invested in a single industry sector from comparing themselves to diversified funds.

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