The first step that I take when looking for a fund are the fees associated with that fund. There is nothing that I hate more than finding a fund with a great track record of growth that turns out to have fees that just make it sub par at best. This is why I separate my funds according to fees first. This way I will make sure that I am only looking at the funds with the lowest fee structure. Once I have done that, I can start to narrow down my choices even more.
The next step is to look at performance over time. I generally go back over the last 2 years to start with, then follow it up to current. As markets are bumpy at times, don't always expect a perfect upward trend. If you could expect this then everyone would be investing. The most important information is to consider the last 3-6 months, however, if they have a poor track record up until then, they could easily go back to a similar trend. For this reason I normally consider their uptrend an anomaly and avoid that fund altogether. Whatever funds seem to have the most consistency are the ones that I choose. I set those aside from the rest.
Now, I take a closer look at those that run the fund. This is extremely important for the future success of the fund. I look at everyone involved in the process and try to find background information. This helps me to narrow down the funds somewhat more. From this point, I generally have 3-5 funds that I am interested in.
Now you have to determine what type of investment style you want. I personally like undervalued small companies, because I feel they have the best chance for growth, however they also offer the greatest risk as a smaller factory has a greater chance of going out of business. This is why it is important to have a high quality management team for the fund you choose. Out of those 3-5 funds, if one to two of them are undervalued investment funds, then I will invest in both of them. If none of them are, then I select large companies with fast growing stocks. I feel there's little risk here, but still a good chance for growth, even if it isn't as good as it would be for the small businesses.
-------------------------



