Start with the Securities and Exchange Commission and/or the state the fund is registered in, and check for all disclosures and any negative press that has occurred. Research the tenure of the portfolio manager(s), and research not only their SEC and/or state information but also any personal information that is unusual about the manager(s).
Subscribe to one of the many websites that will provide you all historical information about the person/firm, and of course, perform Google searches that contain any aspect of the person’s or fund’s name. Stay away from managers who display lavish lifestyles. And in the hedge fund world, make sure the fund is registered with the SEC or state and that this registration has been in effect since it was founded.
There are a dizzying array of funds to choose from. Considering the above will help narrow the choices.
(Editor’s Note: This column originally appeared at Investopedia.com.)
— By Tom Tresnowski, president and portfolio manager, Vincose Capital Management
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