Most mutual funds suck

Most people now know that as mutual funds grow (and they always do) they become the market. Performance over time for 80% of actively managed funds = the relevant index's performance minus the fund's MER (management expense ratio).

Ergot, you have a 1/5 chance of picking an actively managed fund that beats the market. Some conclude that the smart thing to do is to buy the market as cheaply as you can with a non-specialized ETF or index mutual fund, shopping around for the cheapest MER you can find. This is reasonable IMHO. I think that for the majority of investors who are not into this kind of thing (investing), the "couch potato" portfolio of low cost ETFs is the way to go. Minimal effort and a long term performance that beats most of the pros.... tough to argue with this approach, eh?

I own only 2 mutual funds. One is from PH&N (known for their low turnover and low MERs) and another from Chou Funds. Francis Chou is a fascinating but low key fellow and a Canadian version of Benjamin Graham. His fund performance over the last 20 years has systematically destroyed most high priced hedge funds' results, most of whom have much shorter track records. If you're interested, you can do more research about him and his funds (he doesn't advertise) via a google search. I don't want his funds to get much bigger than they already are so I definitely don't want to promote him either! (lol)

This 2007 lecture by Francis is worth watching: Francis Chou