Beta or market risk Mutual funds are sliced and diced as much as any financial product. That's a good thing. Each of those variables takes on particular significance in different situations. In general, experts advise paying close attention to fund fees and long-term performance. Fees cut into performance.
Fees grow in importance as potential return falls.
For example, a money market account's return is mostly dependent on how high its fees are. The fund manager, in that case, can't out manage excessive fees. On the other hand, a stock fund can transcend excessive fees at least for a while. That's where long-term performance comes into play. Let's say you find an expensive fund with a stellar one-year performance relative to its peers.