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I am considering investing in a Mutual fund that has great returns (beating the SP500 index by 3x over 2,5,10 years) but it's somewhat obscure, not carried by Vanguard or Fidelity. This gives me some pause. I'd like to do some more research on how "legit" they are but not sure where to start.

So I'm a bit more interested in the "behind the scenes" stuff. (Trying to avoid a Bernie Madoff situation :-). I realize that all MF's are somewhat regulated but ya' never know. I'd like to do some due diligence.

According to Vanguard.com:

This fund is not available for purchase or transfer This fund is not available for purchase and cannot be transferred to your Vanguard Brokerage Services® account from another financial institution

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    Vanguard and Fidelity have their own mutual funds that they sell on their web site. To invest in other mutual funds through Vanguard and/or Fidelity, you need to have a brokerage account with them, not just be an investor in their in-house funds. Their brokerages do not offer all available mutual funds, only some of them. So when you say "not carried by Vanguard or Fidelity" you mean you can't buy this particular mutual fund through their brokerages, right? Or did you go to the Vanguard and Fidelity mutual fund investors site and didn't find your fund listed there? It won't be there.
    – Dilip Sarwate
    Commented Mar 9, 2012 at 20:56
  • @ Dilip : I do have a brokerage account w/ Vanguard and their site says that you can't buy it through them (I confirmed this w/ a call to Vanguard brokerage services.)
    – Clay Nichols
    Commented Mar 9, 2012 at 22:25
  • There can be any number of possible reasons why the fund is not available through Vanguard's brokerage, and that Vanguard thinks it is fishy is just one such reason. Others could be Vanguard Brokerage thinks the sales charge is too high (or too low!) or the expense fee is too high or Vanguard does not offer funds with 12b1 fees etc. You will need to find a brokerage house that does offer the fund and open an account with them, or open an account directly on the fund's web site. Tread carefully!
    – Dilip Sarwate
    Commented Mar 9, 2012 at 22:39
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    beating the index for 10 years by x3 sounds fishy. Remember, Madoff has been running his scam for years. It will blow up eventually.
    – littleadv
    Commented Mar 9, 2012 at 23:55

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Just because it's regulated doesn't mean it's not still a scam. Anyway, check out http://www.morningstar.com . They have extensive research on mutual funds -- some of which you can get for free, some of which are only for their premium members.

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    Some public libraries also allow you to search the complete Morningstar database. Go to your library's website and look to see what electronic resources they license.
    – MattMcA
    Commented Mar 11, 2012 at 17:57

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