Also, watch for changes in the management of your fund. There may have been mitigating circumstances that have corrected themselves. Perhaps it is a sector or investing style that is coming back into favor. They ve probably grown large due to their success and popularity. Large funds are very hard to maneuver.
Money managers have a hard time moving the assets around quickly which can lead to underperformance.
Be Cautious of New Funds Recent statistics show that two new funds are brought to the market everyday. This rule does not mean don t invest in a new fund. It means that before you invest in a new fund find all the information you can on the management team of the fund and what their investment style is. Bad press can absolutely destroy a sector fund. A good example of this is the Lexington Troika fund.