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I may be destroying your faith in the system with my cynicism, but sooner or later someone will by cynical. Investing in mutual funds is all about money. The people who run mutual funds are in the business of separating people from their money. To be certain they are regulated, they take a very long term view and do not want to destroy the goose that lays golden eggs - but if they don't make money they do not survive.

This is not to say mutual funds are a bad investment idea. I do not have a clue about investing in mainland China, but that is an area I want a portion of my portfolio. So I picked a mutual fund on the theory people who have been earning a living for a more then 10 years know more then I will. So far so good.

One exchange of posts was something about investing in individual stocks. I do that. But there is no way I, who buys a few hundred shares of individual stocks, can possibly know as much as the people buying tens of thousands of shares. Regulation FD has helped a little, but not completely equalize the information.

Quite seriously investing in stocks is very much like picking someone to be in the top half of an auto race or sport team standing. If you want to pick one stock (one NASCAR driver) your risk and reward potential are much greater then betting on Any of the #1 seeds in the NCAA tournament (a mutual fund is really a group of individual stocks). Clearly some people are better then others at picking the winners in both investments and contests.

It takes a fool or a good deal of experience to bet a large portion of one retirement on either a stock or a stock car race in my opinion.

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