I'd like to include a large-cap value fund in my new job's 401k account, but the only one offered is the AllianceBernstein Value Fund (ABVIX). It's only about a year old. It had a pretty good year last year, but how much faith should I put into a one year old fund? It doesn't even have a Morningstar rating yet. Would you trust this fund, or should I keep my money elsewhere until this fund proves itself?
2007-03-06 22:22:16 · 4 answers · asked by Anonymous in Business & Finance ➔ Investing
If it were a start up company, it would be questionable, but it's AllianceBernstein. I don't know the specific details, but a I would wager that they have a management team that has been running money for a long time. Either they have been running institutional money and have just launched a retail fund, or its a team that was lifted out from another organization. AllianceBernstein isn't going to pull a bunch of no track record stock jockeys out of B-School and give them a fund.
If it's your only option, I wouldn't worry too much.
2007-03-06 22:57:30 · answer #1 · answered by BosCFA 5 · 1⤊ 0⤋
The only thing that matters at a mutual fund is the management team. Like the guy above said, AB would not pull a management team from nowhere and let them manage a fund. The people managing the fund probably have plenty of experience and a decent track record. This would not be a risky investment.
2007-03-07 03:47:19 · answer #2 · answered by Charles C 2 · 0⤊ 0⤋
I would research the fund manager and see what they've done elsewhere.
You can also compare the holdings to funds with similar strategies to see where they're headed.
Unproven is riskier - but I've tripled investments in a year on young funds, so it's not always a bad thing.
Didn't everyone have a good year last year? :D
2007-03-06 22:58:53 · answer #3 · answered by pepper 7 · 0⤊ 0⤋
I would not trust it if it is not rated.
2007-03-06 22:26:19 · answer #4 · answered by Dr Dee 7 · 0⤊ 0⤋