Course 504: When to Sell a Fund
The Fund Loses More than It Should
In this course
1 Introduction
2 The Fund Loses More than It Should
3 The Fund Gains More than It Should
4 The Fund Changes Its Strategy
5 The Fund Underperforms for a Long Period
6 Your Goals Change
7 You Just Can't Take It Anymore

Suppose a bond fund loses more than 23% in a year in which its average peer suffers a much slimmer loss. That was the case with Merrill Lynch World Income MAWIX in 1998, a multisector-bond fund that made a big bet on emerging-markets debt in general and Russian debt in particular. Shareholders who expected boring bond performance should have sold.

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