JPMorgan Natural Resources -48% down but still hanging on

HardCoreProgrammer

3 years is more than enough. I would dump a fund if it underperforms the benchmark for 3 years with no rational explanation.

bowlhead99

The rational explanation is that they are not attempting to buy all the companies in the benchmark at the proportions of the benchmark. Someone who wants the benchmark can buy the benchmark if they can find a suitable vehicle for doing that.

If the manager had to act as if they were going to be judged one quarter or one three-year-period at a time, they would probably tend to hold a boring selection of companies that were unlikely to significantly underperform or outperform the index; and then there would be no point buying their fund and paying them management fees.

HardCoreProgrammer

Fund managers get paid a lot of money to manage other people's money and they are expected to outperform the market with their skills.

If a trader in an investment bank consistently underperforms the market, I would expect to find their belongings in a bin bag well before 3 years are up.

Just out of interest, are you a fund manager?

masonic

HardCoreProgrammer wrote: »

Fund managers get paid a lot of money to manage other people's money and they are expected to outperform the market with their skills.

If a trader in an investment bank consistently underperforms the market, I would expect to find their belongings in a bin bag well before 3 years are up.

Just out of interest, are you a fund manager?

So, let me get this right, you will only hold a fund if it hasn't underperformed its index over any 3 year period since inception?

Thrugelmir

HardCoreProgrammer wrote: »

Fund managers get paid a lot of money to manage other people's money and they are expected to outperform the market with their skills.

Which will result in some Fund Managers getting it wrong. Ultimately there's a degree of luck. All depends on the theme that the FM is following.

jabbahut40

Hi All,


After holding this fund for a few years I finally decided to switch into 2 other funds which I felt were more likely to grow and better balance my portfolio. I lost a painful -61% however decided to move on rather than trying to recover my losses.


Thanks for all the feedback and comments.


Jabba

Thrugelmir

jabbahut40 wrote: »

better balance my portfolio.

That's the key. You'll have both winners and losers in any portfolio.

puk999

I stuck a little bit in this fund one month ago thinking it's probably at the bottom. Now down 14.1%. Incredible! Reduced the holding when it was -10% to reduce the bleed a bit.

I used to hold this fund in big proportions back when it was climbing and I knew nothing about having a balanced portfolio (before my days reading on MSE). Alongside the Threadneedle Latin America Growth Fund and other similarly high risk ventures. Back in the days when I used to search for what funds had been growing amazingly and dump most of my money there.

Last month has been a good lesson that funds can just keep falling but I still think this one has good rebound potential but now isn't the right time in the economic cycle. Maybe when global equities aren't doing so well?

mike88

You only lose money when you sell. Paper losses (and gains) are a fact of investing life. At some point commodity prices will rebound and so will this fund. I'd rather buy the fund at the present price than invest when prices are high based on past performance as many do.

If I held the fund, and faced heavy paper losses (which I wouldn't as I adopt a stop/loss system), then I would hang on. For those who have held on to the fund for a considerable time I would say that a valuable lesson has been learned. I have been there too many times.

inflationbuster

This is why you should avoid funds and invest in a basket of stocks in a variety of sectors. The fund is a dog.