Mutual Funds/Sell shares?


QUESTION: I bought shares in a mutual fund in 2012.I paid $63.83 per share.Now the share price is $54.57.Now, the year-to-date rate of return is 5.18.It seems like I made good money the first half of this year but I could use some of the principle money that is invested in this account.Would it be wise to sell some of the shares at a loss/Thanks!

ANSWER: Hi Randy--

The key questions are:

1. How good is this fund? How many stars does it get from Morningstar?
2. Is it a well diversified fund--assuming it is the key fund in your portfolio?
3. How badly do you need money?

Write and tell me the name of the fund and I'll check it out.


---------- FOLLOW-UP ----------

QUESTION: Name of fund-American funds Capital Income Builder.I don't know the number of stars.It isn't my key investment.I am retired & could just use a little extra spending money.

The fund gets 3 stars from Morningstar--average--
The American funds in LA are a classy outfit--although the company charges loads--
The fund is yielding over 4%, and Morningstar's analyst thinks it's headed in the right direction (boosting its allocation to stocks and away from low-yielding bonds)--

There are better funds out there--I prefer the Vanguard family, and like Vanguard Dividend Growth--and Wellesley Income--
but this is an OK fund for someone looking for yield--

So it's up to you--how badly do you need a lump sum of cash?

Good luck.


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Warren Boroson


Author of "Keys to Investing in Mutual Funds" (Barrons), "Ultimate Mutual Fund Guide" (Probus), "How to Pick Stocks Like Warren Buffett" (JKLasser), and "The Reverse Mortgage Advantage" (McGraw-Hill). Former financial columnist for Gannett News Service.


Author of 20 books; winner of 1996 Personal Finance award from Investment Company Institute and Washington University. Formerly on staffs of Money and Sylvia Porter's Magazine. Had a radio program (on WEVD) about mutual funds and a newsletter, FundDigest.

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