Top 10 Factors Affecting Mutual Fund Companies Rankings

1. Fund Performance – The performance of mutual fund companies will play a big role in the rankings of these companies. Investors and the companies which determine the rankings evaluate the long-term performance of the fund to determine whether the it is a quality choice or a mistake for most investors.

2. Cost of The Fund – The total cost of a fund will also help determine the ranking that the fund company receives. Some companies charge more fees and higher expenses, so they are not as good of an investment as those with lower fees and fewer expenses when the performance of each fund is the same.

3. Types of Funds Offered – The fund type is another factor considered when companies are ranked for investors. The fund type designation determines which funds are grouped together. Energy, real estate, health, financial and other types of funds are normally ranked against each other according to the sector the mutual fund is in. Some companies only offer a few types while others have a wide range of options.

4. Return On Investment (ROI) – Mutual fund companies are ranked using the company’s return on investment as one of the determining factors. The better the ROI is for a mutual fund the higher the ranking of the company will be. All of the funds for the company are averaged for this factor.

5. Load Fee Designation – One of the ranking factors for mutual funds and the companies that offer them is whether there is a load or no load designation. No load funds usually have a lower cost but do not offer any investment advice in exchange.

6. Number of Funds Offered – Some companies are larger than others, and may offer more choices and variety for the funds available through the specific company. A large selection of choices will usually cause a company to rank higher.

7. Company Reputation and History – One of the most crucial mutual fund companies ranking factors is the history and reputation of the company offering the funds. Some of these companies have been around for decades, and have built up a reputation for great products and reasonable fees. Others are relative newcomers without an extensive history, and these will usually rank lower because of this.

8. Fund Management – The management of a company will play a part in the ranking the company and related assets receive. If there is new management then the ranking will usually drop some initially, and funds which have management that has been in place for many years will usually rank higher.

9. Level of Risk Involved – The risk that a fund company poses will play a role in the ranking that the company is given. If a company is considered a bigger risk then the funds offered will be ranked lower by most rating companies.

10. Average Fund Turnover – Another factor used to rank mutual fund companies is the average turnover of the funds that the company offers. Funds with a high turnover are usually more expensive, so most investors look for companies that offer choices which have little turnover in the fund.
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