About Michael A. Weiss, CFA Expertise I can provide high quality answers to questions about mutual funds domiciled in the United States. Overall, I have 15 years of investment experience. I am currently the Editor of <a href="http://www.mutualfundinvestor.net/">The Mutual Fund Investor</a>, a quarterly publication that provides recommendations and commentary on various no-load mutual funds. I am also currently the Chief Investment Officer of a state registered investment advisory firm that specializes in no-load mutual funds.
Experience Overall, I have 15 years of investment experience. I am currently the Editor of The Mutual Fund Investor, a quarterly publication that provides recommendations and commentary on various no-load mutual funds. To learn more about The Mutual Fund Investor, please visit <a href="http://www.mutualfundinvestor.net/">http://www.mutualfundinvestor.net/</a>. I am also currently the Chief Investment Officer of a state registered investment advisory firm that specializes in no-load mutual funds.My mutual fund experience began at a company called Lipper Analytical Services, where I researched and wrote about mutual funds. Lipper is one of the premier mutual fund research and ratings organizations. After Lipper, I worked as an investment analyst for Merrill Lynch’s multi-billion dollar Mutual Fund Advisor and Selects Programs. I also have experience working with individual stocks and bonds. I have managed investment portfolios for both Merrill Lynch Investment Managers as well as Evergreen Investments.<BR><BR><B>Organizations</B><BR>CFA Institute
CFA Society of Philadelphia
<BR><BR><B>Publications</B><BR>The Mutual Fund Investor
<BR><BR><B>Education/Credentials</B><BR>CFA charterholder
MBA in Finance and Investments from the Zicklin School of Business at Baruch College<BR>
Expert: Michael A. Weiss, CFA Date: 11/7/2007 Subject: Load and no load funds
Question I am getting ready to max out the 2008 Roth IRA for both me and my wife at the beginning of the year. Last year we did the same thing but with a loaded fund family. We are 24 and 25 years old and the broker told us that it was a better idea in the long run to pay the load, and have a very low expense ratio (.35% average) over 7 funds. Do you suggest that we do something different this year? Your thoughts and suggestions would be appreciated.
Answer Hi Jason,
Thank you for the question and I think it is great that you and your wife are seriously investing at such young ages. I prefer no load mutual funds partly because the costs are usually lower and the service and experience you get from a broker may not be very good. However, if you do not have the time or experience to select your own funds, then going though an advisor and buying load funds might be okay for you, especially if the average expense ratio is 0.35%. Actually, most load funds have expense ratios that are substantially higher those on no load funds. The expense ratios on the A shares for load funds are usually the lowest, but are still normally higher than 0.35%, which sounds very unusual to me. The American funds, a load fund family, have very low expenses, but even many of their funds have expense ratios that are higher than 0.35%. If I were you I would look into the load funds that the broker is recommending to make sure that the fees are accurate.
I do not have any way to evaluate the load funds you are referring to because you did not mention their names, but if fees are your only consideration, then you might as well go with Vanguard and buy several index funds. Their index funds have no loads and have fees that are considerably lower than 0.35%.
