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Fund Reveal-- Please try it out

edited March 2012 in Fund Discussions
I urge every one to go to the home page of Fund Reveal. There is a 15 day free trial to run your portfolio through the easy to use report analysis. This will show the following:

Comparing to SP 500
1, Average daily Return
2. Worst Case return
3.persistence rating
4. Risk Return Rating

I did this and was amazed as I look back now how I could have made much better choices with this tool.
When you look at it don't just scan it with a glance. --- Take the time to enter your portfolio.---Run the sorting capability. Think and look back at would have happened and think about the predictive value for the future.
I hope David Snowball comments on this post.

prinx

Comments

  • I would suggest that David delete this ad for Fund Reveal.Com.
    Ted
  • FWIW, it just seems like a person who liked a site posted their opinions on why it is good for them, not an ad posted by the owners of the said site. Seems reasonable enough to me. No different than posting to any other link (e.g., morningstar or anywhere else for portfolio testing)
  • Reply to @Ted: While it certainly is an enthusiastic endorsement, prinx joined the discussion board in April 2011 and has been a reasonably active member of the community for the past year. There is, so far as I can ascertain, no commercial motive involved.

    For what it's worth,

    David
  • Thanks Accipter,
    I really got excited about the site and wanted to share it with others. But I may be off base and missing something. So I want to find out what others think before I plunk down $100 annual subscription fee. I am wondering if I could not get the same info by printing out the performance site from Yahoo finance for each fund which would be laborious..
  • Dear prinx: Sorry for the confusion, thought you were the owner of Fund Reveal.Com
    Regards,
    Ted
  • It seems to me that there are two issues at play with Fund Reveal's data. One is their decision to benchmark everything against the S&P500. The other is the limited time-frame used in their studies. At base, they know that a Quadrant A fund has about a 70% chance of being in the same quadrant in the following year. They don't know how long it will remain there and their published claim of outperforming the S&P assumes that you sell all of your funds on the 12/31 of each year and purchase all of the preceding year's Quadrant A funds. That model might not work so well for folks who prefer - for tax or other reasons - to hold funds for the long-term.

    None of that invalidates their method, it just highlights the limits of what's yet known about its outcomes.

    David
  • Reply to @prinx: Their response would be that the Yahoo data is not nearly so fine-grained (my word) as theirs. As a result, it wouldn't be as insightful.
  • I signed up for the trial but was so intrigued by FundReveal that I went ahead and opted for the $150 package. The screener tool is useful for discovering loaded, closed, and institutional mutual funds with a high entry price tag. The screener offers little for me as I’m looking for no-load, open, NTF mutual funds that cost less than $5k to purchase through Schwab. That doesn’t mean I can’t locate what I’m after with the screener. I found several possibilities that meet my criteria that I may have overlooked without it. It’s simply a tedious process to shuttle back and forth between FundReveal’s screener and Schwab. It’s probably too soon to tell but for now the screener has proved not worth the extra fifty bucks. More will be revealed.

    The analyzer is a different animal, especially since I’ve been chastened by the tech/internet implosion of the early last decade and seen what happened to just about everyone in 2008. I’m more risk averse than before. Lesson learned. The analyzer appears to be a useful tool for this given their Risk/Reward “A” rating system. Suddenly, the high fliers that might have gotten my attention and cash in the past don’t look so hot. Watching them move around on the Universe Comparison Graph through the years is sobering. It’s also useful to research funds to see if their investment strategy actually matches their performance. RWGFX has done well for its short life span, for instance.

    Yet FundReveal’s screener is an incomplete tool. For my needs, it still takes MFO to generate the ideas along with Schwab’s Advanced Fund Screener. Then follows Lipper Leaders and Morningstar Premium for deeper drilling. And no, I don’t work for Schwab, M* or Lipper. I don’t even play them on TV. Rick
  • Dear Glampig: Glad to see you posting after all these years. I hope you get your $150 worth out of this website.
    Regards,
    Ted
  • Reply to @Ted: Thanks, Ted. I mostly lurk. But I make it a point to read every post and link. Your contributions are still amazing. Ten years haven’t blunted your detective edge and enthusiasm. MFO is a good virtual place to “meet” so many contributors who are so knowledgeable. I’m in awe, actually, of the manner in which this board shares so freely. I’m way out of my league in comparison with much to learn around here. Your links are an important part of my rediscovery of investing. As to the $150, it may be another one of those expensive lessons. Then again, the $150 may also save my bacon and grant a better night’s sleep.
  • MJG
    edited March 2012
    Hi Guys,

    I visited the Fund Reveal website today.

    Fund Reveal uses average Daily mutual fund returns and their volatility when making its recommendations. Their methods average data over various timeframes, but it is updated daily.

    Loosely speaking, the Fund Reveal approach appears to be a momentum-based strategy. Its recommended approach is to select funds that outperformed the S&P 500 Index benchmark for the data collection test period, revisit it perhaps monthly, and revise the portfolio on a quarterly schedule based on its most recent comparisons. The approach seems very pedestrian; nothing really exciting here; no new investment strategy discoveries.

    The fundamental shortcoming to the methodology is that it contrasts all mutual fund categories against the S&P 500 Equity Index, a fatal weakness that Morningstar abandoned a decade or so ago.

    In its videos, which I will reference later, Fund Reveal complained that other rating agencies (think Morningstar) used backward looking data; so does Fund Reveal.

    Fund Reveal uses a 4-quadrant matrix to illustrate good/bad fund ratings with the axis centered on the S&P 500 Index. Mutual fund Average Daily Returns and Volatility parameters are plotted on the two axis system. Its higher ranking funds outperformed the S&P standard for the rating period. What is the forecasting method other than the dubious hypothesis that past performance will persist?

    By only comparing against a single benchmark, portfolio mix could be dominated by a single category of mutual funds that outperformed the S&P standard for the test period. Diversification will be the first casualty of that process, and an ultra-sensitivity to market sector swings will follow immediately. This is not a sensible application of modern portfolio risk management theory.

    In some undisclosed manner, Fund Reveal also seems to integrate Daily Worst case returns relative to the ubiquitous S&P 500 Index benchmark into its decision making process. The decision weighting factors are not defined.

    In its tool development phase, Fund Reveal used various data collection timeframes and tested their power against out-of-sample future performance to identify an “optimum” data period. That procedure is statistically solid, but details were not given, so trust is required.

    The firm does NOT endorse frequent trading. At one point in its Webinars, the presenter talks about a monthly review of relative performance, with a weeding operation on a quarterly basis. He recognizes that the economy and the markets are dynamic, and any fund manager’s skill set or temperament might not be compatible with those dynamics. But none of this policy is forecasting future success reversals; the future remains cloudy even for the Fund Reveal universe.

    Check out this 6-segment series conducted by the site founder. You judge for yourself, but I rate it at the very amateurish level of sophistication. Each segment is about 6 minutes long. The sound quality is very poor. Here is the Link to the 6-part Fund Reveal Webinar:



    For me, staff is an important element in any candidate investment resource. Investing is hard work. Check out the limited staff profiles; only two were provided. The site founder is also the chief researcher. He has credible credentials, but he might be the Lone Ranger in the key research operation. The staff is likely to be thin. An isolated, overworked single resource is prone to error.

    Overall. I’ll pass on this investment tool. I wish them well, but I suspect they do not bring anything new to the territory. I surely could be wrong in my limited assessment.

    The Fund Reveal methods are proprietary. To corrupt Sir Winston Churchill 
"I cannot forecast to you the action of (Fund Reveal). It is a riddle wrapped in a mystery inside an enigma."

    For those MFO members who subscribe to the Fund Reveal service, I wish you great success. Let us know how well you do.

    Best Regards.
  • Reply to @glampig: I wish you luck on your investment. I would like to hear your thoughts down the road, good or bad.

    You mention that after 2008 you became a more risk adverse investor. That would be true of myself and probably many on this board. 2008 led me to purchase funds like FPACX, YAFFX, PRPFX. ICMAX was on my radar but went with ARIVX. I looked at the Forester funds and Sexton International. These were many of the funds mentioned after 2008 that came out as lower risk, average to high returns. Are these the funds that Fundreveal's fund screened points out for risk adverse investors? Just curious.
  • For me, the fatal flaw, and I do mean FATAL, is the use of the S&P 500 as a comparison. That provides no meaningful insight to me, except for those few holdings that are pegged to that index. To charge $150 for this problematic issue is very expensive. There are other options that provide a much better analysis.
  • edited March 2012
    Free "Tool" That I like....

    Is the SmartMoney "Risk" tool, which displays a 3 year (only time period available, a shame) scatterplot of return + standard deviation, for fund, with cluster of related funds based on Lipper categories (ditto). Example in link below, for American Century's Equity Income fund:

    http://www.smartmoney.com/quote/tweix/?story=risk
  • Reply to @ibartman:

    Thank you. An interesting view point.

    Regards,
    Catch
  • Reply to @ibartman: Hi, Ira. You find such cool stuff. Thanks for this. David
  • edited March 2012
    Reply to @ibartman: That's a great one, which I use frequently to get a first snapshot of a fund I'm not familiar with.

    Another plot tool I used to use a lot was a Lipper "interactive" tool using the same coordinate system as the one on Smartmoney, through which you could compare any fund to any other fund you chose, over multiple time periods. It seems to have been discontinued; I can no longer find it on any of the sites that use Lipper data.

    Anyone know if that Lipper tool is still around?
  • AndyJ I have been using Market Watch Compare to do what I call a side to side comparison of up to 5 mutual funds or ETF's or a combination to see 1 wk 3 wk ytd
    1 yr 3 yr 5 yr 10 yr returns and also all fees and loads and finally comparison of risk factors for each selection. The site is simple to use and covers a lot for one click. Try it and let me know if this is what you had in mind.

    prinx

    http://www.marketwatch.com/tools/mutual-fund/compare
  • Reply to @prinx: Thanks, prinx, but no, the Lipper tool was essentially a more interactive version of the Smartmoney tool that ibartman mentioned above. It's a graphic, rather than a set of tables, using coordinates on x-y axes to depict risk-adjusted return.
  • TD Ameritrade has something similar...

    It's at link below, but is a little tricky to link/explain... I will try.

    http://research.tdameritrade.com/public/mutualfunds/compare/compare.asp

    The tool gives you risk/return plots - for 1, 3 and 5 years, of funds or etfs (? stocks) of your choosing.

    Here's how it works.

    Go to link above.
    Enter list of comma delimited symbols in box at the right [Compare Funds].
    Example: DEF, VDIGX, VEIPX, IVV.
    Column comparison will appear.
    At top are several tabs.
    Select [Ratings and Risk]
    Displays 4 graphs, 1 at a time: YTD, 1 Yr, 3 Yr, and 5 Yr.

    Below is link, but not sure that link will be stable, i.e. continue to work. Time will tell. (Issue is with TD, not with tinyurl.)

    http://tinyurl.com/TD-Fund-Compare
  • edited March 2012
    Reply to @ibartman: That's the ticket, very much like the defunct Lipper tool, plus you can do etf's alongside traditional mf's. Good sleuthing. Gracias.
  • I ran the Fund Reveal analysis on my portfolio and was surprised to find it showed my worst fund to be GRT Value Fund (GRTVX) which I believe has received some good press on this board. I am sticking with it.
  • I called Fund Reveal and asked about the rating of Fairholme back in December before the FAIRX debacle. Ani the principal told me that the Fund Reveal Fund data
    base system was already showing a FAIR deterioration of its grade in his system and predicting an imminent decline before it happened. I did get out of Fairhome in January but not because of Fund Reveal but actually I heard a very convincing discussion with Hedge Fund manager David Einhorn and I sold it.
  • To All
    circa33
    would like an opinion on bar chart as an fund screener
    and starting point for dd on a mutual fund.
    thanx
    circa33
  • Thank You ibartman for year info on Ameritrade compare funds site.
    So far it is the only site I could find that compares CEF,EFT, and mutual funds all at
    one site side by side. It is very good. However it does not give the extensive information that you get with MarketWatch comparison with only ETF and mutual funds, The latter also gives you a longer time frame,risk,holdings and fee and cost info. But for a simple quick look the Ameritrade looks good.
    prinx
  • RE: Fund Reveal


    Several members stated that a flaw in Fund Reveal was the use of the S&P 500 as a bench mark. It also bothered me because the arguments presented were definitely
    convincing. I called the site and spoke with Ani one of the creators and he maintained that his intention was not to use the S&P as a benchmark in the usual
    sense as we usually are accustomed. He essentially is saying that in time as you look at your investment performance with a particular fund, if it under performs the S&P then you might have just as well invested in the S&P . It may also be an aid to investors who have a tendency to stop the phenomenon of falling in love with your fund so to speak when keeping a fund year after year in your portfolio. It may be easy for investors to find all kinds of reasons to hold a fund and not leave go.

    I try to expose my self to lots of tools. Some I find more valuable that others and I use them more. However I look at it this way. If a site over a period of time can teach me something and helps me with a profit with just a few ideas where I have made some changes either addition or elimination of funds then it is very well worth the price of the subscription.

    Burt
  • Reply to @prinx:

    "He essentially is saying that in time as you look at your investment performance with a particular fund, if it under performs the S&P then you might have just as well invested in the S&P ."

    Sorry prinx, I don't buy that reasoning at all. In fact it makes no sense to me. Does that mean you might as well not diversify your equity holdings (large, small, value, growth, domestic, foreign) if that diversified portfolio doesn't beat the S&P500? That sounds he is feeding you a line of bull to justify his tool. Small caps should be measured against small caps. Balanced or allocation type funds against their peers, ect... - not the S&P500 index. There is more to owning a fund or a collection of funds then beating this large cap index.
  • edited March 2012
    Reply to @prinx: Prinx, my question and ibartman's answer were about a very specific return-risk plot tool; neither of us suggested in any way that it was the only tool an investor ever needs to use.
  • Thank you Mike M for your comments.

    You have a point but I do not think it is valid. It clearly uses the S&P 500 but I do not think that the editor of Fund Reveal intended for us to us to interpret it in the sense of a benchmark. Another way to look at it is as an alert signal.

    When you are asset allocating as to style , size ,class and etc etc. you have many choices to fulfill your completed plan. Some where along the line there will be a bad choice for one reason or another either from the initial stage or as the plan is in operation. Not all elements of the plan are the best picks from the get go. If they are that does not mean their strengths will persist. The way this information offered by Fund Reveal will be just a deeper look into the guts of the fund with regard to its average return and what risk this fund will take over a period of time. Remember this information cannot be static. Its value to you is looking at it in terms of finally evaluating a choice of small caps with other small cap funds showing in quadrants ABCD the scatter of the compared funds and revealing the best and worst performers and and also the comparison of their worst performances over a period of time. This is valuable information readily available at this site.
    In the best scenario you would have to agree would be the fund that consistently has the best return with the least risk over a period of time. The question should be is how reliable is this information and what is the chance that this prediction is accurate as to its persistence with regard to quadrants ABCD remaining in place.

    I am adding this to my tool box. In it you will find IBD, No load Fund M* , MarketWatch compare, Yahoo Finance and most importantly Mutual Fund Observer. At any given time, and I never know when this will happen, I will make a profitable choice in investment that I will owe to the use of one or all of my tools.

    Prinx





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