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snousleI spent a little time looking at my retirement account, wondering if I should do something else with it. Some articles on the monstrous effect of management fees got me more interested - turns out I'm paying about 1.3% fees, which is very high, and over the course of a lifetime this can easily eat 25% of the whole account. So I'm probably going to move it all to Vanguard.
In the meanwhile, I looked at some charts of the performance of the account. What I found was kind of disturbing, and I don't understand it at all.
Here is Diversified's chart for "growth of $100" in the short-horizon fund, taken from a PDF on their web site:
Looks rather appealing, right? The fund also has a ticker symbol, so I looked it up. This is Yahoo's account of the value of the fund over the same time period:
Um. Obviously very different interpretations of performance of the same fund. I thought that maybe the Yahoo chart was in constant dollars, but that doesn't appear to be the case. (??? I can't find a clear answer on that one way or another; in any case there hasn't been enough inflation since '96 to account for the discrepancy.) Maybe the Yahoo chart doesn't include dividends or something?
I would presume that they couldn't actually be lying about the performance of the fund or they'd get their asses sued off. So how can this be? I thought I had a good general understanding of how retirement funds work, but this has me TOTALLY baffled and has left me feeling quite disturbed. Coupled with the discovery of these rather high fees (a recent law makes disclosure mandatory), my impression of Diversified as a good fund manager has been thrown into doubt.
In the meanwhile, I looked at some charts of the performance of the account. What I found was kind of disturbing, and I don't understand it at all.
Here is Diversified's chart for "growth of $100" in the short-horizon fund, taken from a PDF on their web site:
Looks rather appealing, right? The fund also has a ticker symbol, so I looked it up. This is Yahoo's account of the value of the fund over the same time period:
Um. Obviously very different interpretations of performance of the same fund. I thought that maybe the Yahoo chart was in constant dollars, but that doesn't appear to be the case. (??? I can't find a clear answer on that one way or another; in any case there hasn't been enough inflation since '96 to account for the discrepancy.) Maybe the Yahoo chart doesn't include dividends or something?
I would presume that they couldn't actually be lying about the performance of the fund or they'd get their asses sued off. So how can this be? I thought I had a good general understanding of how retirement funds work, but this has me TOTALLY baffled and has left me feeling quite disturbed. Coupled with the discovery of these rather high fees (a recent law makes disclosure mandatory), my impression of Diversified as a good fund manager has been thrown into doubt.
