Investing is far more complicated and difficult than most investors realize. Too many people believe the markets are not much larger than their school classrooms, and the markets will grade them on a curve. They were good students, so they believe all they have to do is learn the right formulas out of the right textbooks, and they will become wealthy. They don’t understand they are competing against millions of investors all around the world. They are all reading the same books and news articles. Some of them are hedge funds with supercomputers faster than the United States military, programmed by quant fanatics with advanced degrees in math and finance.
Most investors don’t realize they need help. That’s why William Bonner founded the Oxford Club, to create a private network of investors who could share their knowledge and experience.
In a recent article, the Oxford Club explained their four principles of investing success. The fourth principle of the Oxford Club’s investing success philosophy is to reduce expenses.
Few investors realize that every extra dollar they pay as an expense out of their portfolio, they are losing a small fortune in future net worth. That’s because every dollar that’s gone fails to multiply exponentially, because it’s gone.
Therefore, the Oxford Club advises its members to avoid mutual funds that front-end loads, back-end loads, unnecessary fees and surrender penalties. These make the mutual fund firm and the manager wealthy, at your expense. Most investors fail to realize just how much most mutual funds take from them in transaction and processing fees and taxes. It’s common for mutual fund owners to pay capital gains taxes on mutual funds even though the fund lost money through the year. If the fund manager sold out a position at a gain earlier in the year, you’re responsible for the taxes.
Read about the Oxford Club: https://bookstore.investmentu.com/Catalog.aspx