The portfolio manager's report is generally followed by a discussion of recent performance. The report should compare your fund's performance to both a benchmark, such as the S&P 500 Index (the standard benchmark for large-company stock funds) or the Russell 2000 Index (for small-company funds), as well as to the average performance of funds with similar investment strategies.
When evaluating your fund's performance, be sure that the benchmark the fund chooses is appropriate for its style. For example, a technology fund shouldn't compare itself to the S&P 500 and nothing else; it should measure its performance against a technology benchmark.
In addition to benchmark comparison, the report should give you an idea of how the fund has performed over various time frames, both short and long term.
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