Contents
Introduction: Decoding the Mutual Fund Game
 Buying the Right Funds at the Right Time
 The Way We Buy a Fund is Plain Wrong
 Investing Knowledge Should Precede Mutual Fund Investing
 Why Investors Must Use Mutual Funds to Play the Markets
 When Should You Invest in Mutual Funds
 The Most Important Consideration -- Consistent Performance by the Fund Manager
 The Returns that You See are Not the Returns that You Get
 What You Should Want from a Fund
 Investing is Much More Than Following Financial Media
 Why We Cannot Rely on U.S. Books on Mutual Funds

1. Why Buy Mutual Funds
 What's Your Edge?
 Why Invest in Stocks through Mutual Funds
 What Mutual Funds Can Do
 Who Should Use Mutual Funds
 It Beats Buying Stocks on News
 Ideal for Investors Who Lack of Time
 Ideal for Investors Who Lack Knowledge
 Ideal for Investors Who Lack the Right Temperament
 Mutual Funds Remove the Emotional Element from Investing
 Mutual Funds Temper Unrealistic Expectations
 Protection Against Market Breakdown
 Mutual Fund Managers Can Pick Stocks Better than Most of Us
 Caution: Why Mutual Funds Alone Don't Do the Job
 Fund Managers Try to Stay With the Pack
 Why Mutual Funds Don't Work
 Investing for Your Financial Needs
 The Secret of Picking Funds
 Fund Names Don't Mean Much
 The Risk in Mutual Funds
 When to Exit a Mutual Fund
 Mutual Funds for Trading
 Mutual Funds for Small Cap and Mid Cap Investing
 Time Your Mutual Fund Entry and Exits
 Is the Fund Brand Important?
 Importance of the Fund Manager
 You Don't Need to Invest Regularly or Be in a Systematic Investment Plan
 What Type of Bond Fund Should I Be In?
 Should You Move From Equity Funds to Bond Funds if the Stock Market Collapses
 How Frequently Should You Review Your Mutual Fund Portfolio?
 Should I be Concerned about Frequent Churning of the Fund's Portfolio?
 Should You Worry about Entry and Exit Loads
 When Worst Performing Funds May Be the Right Funds to Invest In
 How to Pick a Fund
 Do Fund Ratings Work?
 How to Buy Bond Funds
 How to Buy Equity Funds
 Don't Fall for Invest for Your Child or Invest for Your Retirement Arguments
 Open End versus Closed End Funds
 The Stock Market, the Bond Market, the Commodities Market
 Mutual Funds Cut Losing Positions
 Shortcomings of a Mutual Fund
 Why Use a Mutual Fund
 Mutual Funds are Your Best Options
 Higher Returns or the Thrill of Doing it Yourself?
 Who are Mutual Funds Ideal For
 Liquidity is the Greatest Benefit of Mutual Funds

2. Types of Mutual Funds
 Habitual Underperformers
 Funds Managed by Star Fund Managers
 Outperformers
 What You Should Measure a Mutual Fund Performance Against
 Local Sponsor Owned Funds
 Foreign Sponsor Owned Funds
 The Benefits of Small Corpus Funds
 Limitations of Large Corpus Funds
 Side Business Funds
 Funds Run by Brokerages and Financial Houses
 Pure Play Asset Management Funds
 Trading Mentality Funds
 What Type of Funds to Buy
 Which Bond Fund Returns Should You Consider
 Does the Fund Hold Stocks Where Managements are Honest
 Don't Rely on Advertisements
 Mutual Fund Performance Regresses to the Mean Over the Long Term
 Decoding Exchange Traded Funds (ETFs)
 Index Funds
 Active Mutual Fund
 Buying Commodity ETFs
 Specialist Fund Houses

3. Developing Your Mutual Fund Edge
 You Must Know How Stock Markets, Bond Markets and Technicals Work
 Leaving Investing and Trading to Experts
 Develop an Investment Philosophy
 Understand Mutual Fund Risks
 Go with Fund Managers Who Choose Decision Making Process over Outcomes
 Develop Variant Perceptions
 Investing in Cycles, Trends and Rallies
 Trading in Cycles, Trends and Rallies
 Get In and Stay Put When a Bull Market Begins
 Get Out and Stay Out When a Bull Market is Ending
 Participate in Bubbles
 Understand How Fund Manager Performance Regresses to the Mean
 Think Ahead
 Cut Losses
 Keep a Diary
 Returns is Your Only Scorecard
 Boot Up Your Knowledge

4. Commandments
 You Cannot Buy Mutual Funds without Understanding How Financial Markets Work
 Thou Must Pick the Right Fund Manager
 Price and Value Don't Always Move Together
 Invest in Funds With No Investment Limitations
 Avoid Buying Funds from Your Bank
 Avoid Buying Funds from Your Insurance Company
 Beware the Humbug of Financial Planning
 Avoid Funds Sponsored by Industrial Houses
 Look for Funds Sold by Financial Services Companies
 Look for Funds Sponsored by Fund Managers
 Look for Activist Funds
 Jack of All Funds, Master of None Fund Houses
 Beware of Funds With Large Assets under Management (AuM)
 Remember, Mutual Fund Investing is a Short Term Game
 Beware: The Conventional Rationale and Methodology of Mutual Fund Investing are Flawed
 Mutual Funds Deliver in Short Spurts but Sell You Long Term Performance
 No Single Mutual Fund Fits All
 Beware: Mutual Funds Tend to Come up With Products at the End of a Rally
 Beware: Falling Markets are Not a Good Time to Invest in Equity Funds
 Beware: U.S. Style Mutual Fund Investing Does Not Work in Asia
 Beware: Boiler Plate Western Mutual Fund Principles Don't Work in Asia
 Why Index Funds Don't Work in Asian Markets
 Many Mutual Funds Significantly Outperform the Index
 Picking the Right Fund at the Right Time is Critical
 Looking at Portfolio Churn is Irrelevant
 Picking Mutual Funds on Short Term Performance is Risky
 You Must Time Your Entry and Exit into a Mutual Fund
 Invest at Points of Maximum Pessimism and Exit at the Peak of Euphoria
 Here's When Large Cap Stocks Give the Best Returns
 Here's When Midcap or Small Cap Funds Do Well
 Go With the Best Performing Funds in a Boom
 Avoid Funds with Very Large Assets under Management (AuM)
 Beware: Fund Managers Can Become Complacent
 Stay Out If Markets Go into a Credit or Liquidity Squeeze
 Flip Your Mutual Funds - Mutual Fund Leadership Changes All the Time
 Read, Invest, Make Notes and Improve
 Don't Project the Current Scenario into the Future
 Beware the Limitations of Fund Managers
 Invest Enough to Make Your Returns Meaningful
 Check If Your Mutual Fund Portfolio Has Many Crowded Stocks
 Beware Auto Fund Collecting Tricks
 Check If the Fund Lives Up to Its Name

5. Beware these Mutual Fund Investing Mistakes
 Buying Mutual Funds in a Vacuum
 Beware of Buying Best Performing Funds
 Buying on Recommendations
 Beware of Buying Dividend Yield Funds or Low PE Funds
 Remember, There is No Cheap or Expensive Market
 Overplaying Your Hand
 Being Good with Numbers is No Advantage in Picking Stocks or Funds
 Not Comparing Returns with Other Options
 Going By the Sales Pitch
 Believing that Mutual Funds Solve Your Retirement, Child's Education or Any Such Challenge
 Liquidating Too Soon
 Beware of these Traps
 Beware of Illiquid Mutual Funds
 Beware: The Fund Name May Mean Nothing
 Wrong Reasons for Mutual Fund Investing
 Moving from Funds at the Wrong Time
 Relying on Mutual Fund Databases
 Confusing Facts with Feelings
 Cashing Out Too Early
 Beware the Salesman Fund Manager
 Beware Fund Managers Who Don't have Skin in the Game
 Being Fooled by Misleading Names
 Beware: The Long Term Does Not Work
 Beware: There is No Such Thing as a Buy and Hold Mutual Fund
 Beware of Investing in Mutual Funds Based on Economic Growth

6. Mutual Fund Myths
 Myth of Investing Based on Your Financial Goals
 You Can Achieve Your Financial Goals by Regular Investing
 You Must Invest in All Kinds of Market
 Passive Style of Investing Means No Home Work
 Buy and Hold is Good For You
 The Myth of Systematic Investing
 Myth: Mutual Funds Work for Everyone
 The Myth of Long Term
 Myth: The Returns from Bond Funds are Safe
 Myth: Mutual Fund Investing is an Autopilot Game
 Professionally Managed Investments Automatically Mean High on Returns
 Higher Risk Guarantees Higher Return
 Blue Chip Funds are Safe
 Myth: Holding High Rating Bonds Makes a Mutual Fund Safe
 Myth: Stocks Outperform Bonds
 Small Cap Stocks are the Best Way to Play Penny Stocks
 Myth of the Rational Market
 You Can Achieve Very High Returns with Very Low Risk

7. Principles of Mutual Fund Investing
 All Funds Don't Work in All Markets
 The Sponsor of a Mutual Fund Matters
 Who Owns the Mutual Fund
 The Law of Averages Catches Up With All Funds
 Which Fund Fits Whom
 3 Types of Funds
 Size Does Not Matter, Market Direction Does
 Small Cap Fund Strategy
 Investing at the Bottom of a Market
 Look for Markets with Weak Signals
 There is No Cause and Effect
 Churning is Good
 Adverse Market Conditions are Good
 Catch the Trend When There is One
 The Market Paradox
 The Uncertainty of the Market
 When to Stay Away from Top Performing Funds
 There Will be Times When You Cannot Make Money
 Mutual Funds Have to Swing the Bat
 Go With the Season, Not the Weather of the Day
 Look for Funds that Build a Portfolio with Low Correlations
 Stay Away from Mutual Funds that are Invested in Crowded Stocks
 Timing the Market is the Only Way to Beat It
 Why Buy and Hold Does Not Work
 Markets Can Stay Depressed for Years
 Risk and Return Attitudes Change With Markets
 Mutual Funds Can be Used for Trading
 Mutual Funds are Your Best Way to Leverage the Stock Markets
 Mutual Funds are Your Best Way to Leverage Bond Markets
 Mutual Funds are Your Best Way to Leverage Commodity Markets
 Mutual Funds are Your Best Way to Leverage Real Estate Markets
 Mutual Funds for Trading
 Mutual Funds for Investing
 Mutual Fund Portfolios
 Start Looking Elsewhere as the Market Gets Obsessed With a Theme
 Measure Fund Performance Over a Number of Years
 Investing in a Bear Market
 Dealing with Uncertainty and Risk
 Inefficiency in Prices is Good
 Making Money is Important, Not Ideology
 How to Find a Fund Manager
 Weed Out Funds Regularly
 When and How to Invest
 What a Good Mutual Fund Should Focus on
 What to Look For
 What Mutual Funds are Not
 Time Your Mutual Fund Entry and Exit
 The Edge is Elusive
 The Longer You are in a Top Performing Mutual Fund, the Riskier it Becomes
 Investing in Fits and Starts Produces Sputtering Returns
 Don't Pre-Decide Your Exit
 Picking the Right Funds
 Have Your Own Strategy
 Stay Away from Funds that Replicate the Index
 The Same Strategies Almost Never Work Again
 How Safe Funds are Risky
 Plan Your Mutual Fund Investments
 How to Improve Your Mutual Fund Performance
 Be Invested in Mutual Funds for the Long Term - But Not in Any Specific Mutual Fund
 All Best Performing Mutual Funds will End up Regressing to the Mean
 Mutual Funds are Way Superior to Pension Funds
 Beware Severe Losses in Collapsing Markets
 Government Securities are Very Volatile - You May Lose Money in Gilt Funds
 Investing Styles
 The Success of Systematic Investing and Investing Regularly Depends on the Type of Market
 Mutual Funds and Crowded Stocks
 Mutual Funds Do Not Perform in Extreme Volatility
 Equity Funds Perform Best in Bull Markets
 When to Go With the Herd
 Insurance Products are Not Mutual Funds
 Long Term Holding versus Long Term Holding
 Investing Requires a Very High Degree of Skill
 Funds with Specific Objectives Can't Deliver Consistent Returns over Long Periods of Time
 Role of Interest Rates and Trading on Bond Funds
 Risk of Liquidity and Default on Bond Funds

8. Psychology of Mutual Fund Investing
 Beware the Anchor Effect
 How Mutual Fund Picks are Affected by Emotion
 Why We Hold On to Mutual Funds
 Fear in a Bad Market
 Don't be Afraid of Uncertainty
 Factors that Heighten the Perception of Risk
 Dealing With Our Emotions
 Investing Because Others are Doing So
 Market Moods Reflect Our Deep Seated Psychological Reactions
 Beware of Psychological Pitfalls
 Investments Should Match Your Temperament
 Traits
 Don't Harp on Past Mistakes

9. Mutual Fund Investing Rules
 A Few Things to Know
 When to Invest in a Mutual Fund
 Don't Spread Your Investments in Too Many Funds
 How to Spread Your Money
 Investing in Bond Funds
 The Importance of the Fund Manager
 Stay in Equity Funds in a Bear Market
 Invest When Markets Lose Their Equilibrium
 Beware of Fund Managers Who Are Too Visible
 Be in the Market When Stocks Begin to Rise
 Buying Mutual Funds at Market Highs
 Don't Stinge on the Fees
 Enter When there is a Liquidity Crisis or Heavy Redemption Pressure
 Go Contrary to the Crowd at Market Extreme
 Focus on Absolute Return Funds
 Don't Fall for Risk Classifications
 Buy Funds that Can Invest in Any Type of Stock
 Passive Mutual Funds Don't Get the Maximum Bang for the Buck
 Don't Rely Much on Mutual Fund Tracking Services
 Check What's Different about the Fund's Portfolio
 Check if the Fund's Portfolio Suit Your Style
 There are No Safe Funds
 Mutual Funds Can't Benefit When the Market Heads Down
 Buy Global Mutual Funds to Leverage Expertise You May Not Have
 Find Fund Managers Who Have Second Level Thinking
 Index Funds are an Ideal Way of Not Slipping on a Stock Market's Rise

10. Mutual Fund Secrets Insiders Won't Tell You
 The Secret of Picking Funds
 Mutual Fund Handicaps
 The Risks in a Bull Market
 Prices Fall Only When People Realize Something is Wrong
 The Once-in-a-Lifetime Opportunity
 Forced Investing
 Value Investing through Mutual Funds is a Winne's Game in Bear Markets
 Enter and Exit When There is a Breakdown in Diversity of Opinions
 Risk Reduces Significantly the Longer a Bear Market Has Been Around
 Invest When the Market is In High Tide
 Beware: There May be No One to Sell To
 Why You Must Flip Mutual Funds
 Investing Directly or Investing through Mutual Funds
 Funds Deliver Stellar Returns in Short Bursts
 Why Comparing Mutual Fund Returns to the Market Index Makes No Sense
 Reduce Errors to Improve Your Returns
 You Can Trade in Mutual Funds
 Mistakes in Mutual Fund Investing
 Avoid Asset Gathering Mutual Funds
 Avoid Funds With Too Many Stocks in Their Portfolio
 Leverage Emerging Themes
 Stay Invested During Investment Manias
 Fund Managers Come in Many Hues
 Why Picking a Worst Performing Fund Makes Perfect Sense
 Today's Best Performing Funds May be the Worst Performing When the Markets are Down
 Mutual Funds Beat Direct Stock Investing for Most Investors
 Why Fund Managers are So Important
 Why Fund Sponsors are So Important
 Investing in Blue Chip Stocks Does not Make a Mutual Fund any Safer or Less Risky
 Mutual Funds Have Access to Information You Don't
 You are Fodder for Market Manipulators and Institutional Investors
 Trading versus Investing Fund Managers
 The Thing about Bond Funds
 The Fund Sponsor's Capital Strength Matters for Bond Funds
 Which Balanced Funds to Buy
 Avoid Funds that Have Multiple Layers of Decision Making
 Redundant Information
 Relevant Information
 Don't Get Carried Away by Self Serving Classifications
 Choose Fund Managers with Guts and Consistently High Performance, Not Gatekeepers
 Check-List for Selecting a Mutual Fund
 Constant Review of Portfolios is Essential
 Why the Short Term is More Important than the Long Term
 Mutual Fund Advisors
 Picking a Mutual Fund
 Looking at Charts of Mutual Fund NAVs
 A Salesman Sells What Gives the Best Commission
 Stay Away from Advertising Funds with Low-Paid Fund Managers
 The Real Test of a Fund Manager is in Disturbed Markets
 Mutual Funds for Entrepreneurs
 A Great Tool for Companies and Businesses to Create an Asset Liability Match
 Who Runs the Fund A Businessman or a Performer
 Why are Your Funds Not Doing Well?
 Bond Funds are Risky if Companies are Facing Distress
 What Mutual Funds Don't Want You to Know
 Equity Funds May Not Able to Invest in Growth Sectors or the Fastest Growing Companies
 Are Bond Funds Really Safe?
 Fixed Income Investments Have Un-fixed Returns
 When Individual Investing Works Better than Mutual Funds

11. Strategies for Mutual Fund Investing
 Buy at Points of Maximum Pessimism and Sell at Points of Maximum Optimism
 Temporary Extreme Events or a Change in Market Direction
 Comparing Stock Buying to Buying a Business is a Flawed Comparison
 Reckon Your Losses
 Timing Your Fund Entries and Exits
 When to Exit
 Fund Picking Strategies
 What Happens When Your Money Starts to Set the Price Level in the Market
 Diversification is a Poorly Understood Concept
 Fund Managers are Happy Generating Average Returns
 Fund Managers Tend to Sell Stocks at the Worst Possible Time
 Look for Fund Manager with Second Level Thinking
 Stay Away from Funds where Most of the Money is on Autopilot
 Avoid Mutual Funds Which Hold Too Many Stocks
 Find Fund Managers and Funds with Fire in the Belly
 Focus on Fund Manager's Investment Thinking and Not His Short Term Performance
 Sector Funds When the Sector is Running up
 ETF Funds When the Commodity is Running up
 Mid Cap Funds when Midcaps are Running up
 Income Funds when Interest Rates are Going Lower
 Mutual Fund Investing in Bull Markets
 Opt for Mid Cap and Small Cap Funds When there is a Rally
 Take Dividends
 Using Mutual Funds as a Trading Tool
 Using Mutual Funds as an Investing Tool
 Using Charts before Buying Mutual Funds
 When to Buy Small Cap Funds
 Invest in Funds that Flow with the Opportunity
 Stay Away from Funds with Crowded Portfolios
 Building a Mutual Fund, Stock Investing and Trading Portfolio
 Timing the Sell
 Event Driven Mutual Fund Investing
 Don't Buy and Hold
 Don't Invest Regularly
 There is a Time for Equity Funds and a Time for Debt Funds
 Balanced Fund is a Recipe for Mediocrity
 Avoid Funds that Invest in Foreign Markets or in Commodities
 Forget Fancy Names Check the Fund's Objective
 Changing Strategy in Bull and Bear Markets
 Finding Perpetual Winners
 Using Funds with Large or Small Assets under Management
 Picking a Fund
 Which Payment Option to Choose
 How to Leverage Mutual Funds for Fabulous Returns

12. Mutual Fund Investing for a Living
 Staying Invested till the Rally Lasts
 Exiting Losing Funds
 Replicating the Market
 Investing with Fund Managers who Perform Best in the Current Scenario
 Investing a Significant Sum
 Staying with the Fastest Runners
 Taking Out 50% of Your Profits
 Measuring Yourself against a Mutual Fund
 High Returns are a Sure Sign of Bad Returns to Come
 Where Funds Fail
 How to Pick a Fund Manager
 Focus on the Downside
 Trade Actively
 Invest before Dividends
 Don't Buy and Hold
 Don't Invest Regularly
 Use ETFs Only in a Frenzy
 Use Index Funds Only in Certain Situations
 Mutual Fund Strategies for a Living