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For illustration purposes only. Past performance is not an indication of future performance.

Evaluating Mutual Funds and ETFs

Presented by:Matthew Vandre, MS HES, CFEIMoney AdvisorFrancis Investment Counsel LLC

For illustration purposes only. Past performance is not an indication of future performance.

For illustration purposes only. Past performance is not an indication of future performance.

Our Agenda

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For illustration purposes only. Past performance is not an indication of future performance.

PLEASE WATCH FOR

AN EMAIL WITH OUR

SURVEY LINK

Or complete the survey at: surveymonkey.com/r/moneyu

For illustration purposes only. Past performance is not an indication of future performance.

What We’ll Cover Today

What a mutual fund is

How mutual funds are different

How to evaluate mutual funds

For illustration purposes only. Past performance is not an indication of future performance.

What is a mutual fund?

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For illustration purposes only. Past performance is not an indication of future performance.

The asset available for purchase in your 401(k) is which of the following types?

A. Stock

B. Bond

C. Mutual Fund

D. ETF

For illustration purposes only. Past performance is not an indication of future performance.

C. MUTUAL FUND

For illustration purposes only. Past performance is not an indication of future performance.

Equity Market Asset Types

SecuritiesEquities Fixed Income

Stock Bond

Ownership of a Company Loan to a Company

Investor $$$

Investor $$

Investor $

Company ABC

Company ABC

Investor $$$

Investor $$

Investor $Investor InvestorTRADING 

(buy/sell)

Company ABC

Investor $$$

Investor $$

Investor $

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For illustration purposes only. Past performance is not an indication of future performance.

Exchange Traded Fund

Securities

Exchange Traded Fund (ETF)

Stock flavored Bond flavored

Ownership of fund gains and losses

Fund Manager

Investor $$$

Investor $$$

Investor $$$

1,2,3,4,5,6,7,8,9,10,11,12,13,14,15,16,17,18,19,20,21,22,23,24,25,26,27,28,29,30,31,32

,33,34,35,36,37,38,39,40,41,42,43,44,45,46,47,48,49,50,51,52,53,54,55,56,57,58,59,60,61,62,63,64,65,66,67,68,69,70,71,72,73,74,75,76,77,78,79,80,81,82,83,84,85,86,87,88,89,90,91,92,93,94,95,96,97,98,99,100,101,102,103,104,105,106,107,108,109,110,111,112,113,114,115,116,117,118,119,120,121,122,123,124,125,126,127,128,129,130,131,132,133,134,135,136,137,138,139,140,141,142,143,144,145,146,147,148,149,150,151,152,153,154,155,156,157,158,159,160,161,162,163,164,165,166,167,168,169,170,171,172,173,174,175,176,177,178,179,180,181,182,183,184,185,186,187,188,189,190,191,192,193,194,195,196,197,19

8,199,200,201,202,203,204,205,206,207,208,209,210,211,212…………….50 – 5,000 Companies

Investor InvestorTRADING (buy/sell)

For illustration purposes only. Past performance is not an indication of future performance.

Assets in your 401(k)

Securities

Mutual Fund

Stock flavored Bond flavored

Ownership of fund gains and losses

Fund Manager

Investor $$$

Investor $$$

Investor $$$

1,2,3,4,5,6,7,8,9,10,11,12,13,14,15,16,17,18,19,20,21,22,23,24,25,26,27,28,29,30,31,3

2,33,34,35,36,37,38,39,40,41,42,43,44,45,46,47,48,49,50,51,52,53,54,55,56,57,58,59,60,61,62,63,64,65,66,67,68,69,70,71,72,73,74,75,76,77,78,79,80,81,82,83,84,85,86,87,88,89,90,91,92,93,94,95,96,97,98,99,100,101,102,103,104,105,106,107,108,109,110,111,112,113,114,115,116,117,118,119,120,121,122,123,124,125,126,127,128,129,130,131,132,133,134,135,136,137,138,139,140,141,142,143,144,145,146,147,148,149,150,151,152,153,154,155,156,157,158,159,160,161,162,163,164,165,166,167,168,169,170,171,172,173,174,175,176,177,178,179,180,181,182,183,184,185,186,187,188,189,190,191,192,193,194,195,

196,197,198,199,200,201,202,203,204,205,206,207,208,209,210,211,212…………….50 – 5,000 Companies

Investor FUNDTRADING (buy/sell)

For illustration purposes only. Past performance is not an indication of future performance.

Mutual Fund Differences

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For illustration purposes only. Past performance is not an indication of future performance.

How many different kinds of mutual funds exist today?

A. 1,253

B. 5,321

C. 7,952

D. 2,351

For illustration purposes only. Past performance is not an indication of future performance.

C. 7,952

https://www.ici.org/research/stats/trends/trends_03_18

For illustration purposes only. Past performance is not an indication of future performance.

How Funds are DifferentA whole orchard 

of different mutual funds reduces risk …think about it.

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For illustration purposes only. Past performance is not an indication of future performance.

How Funds are Different

LARGE MID SMALL

VA

LUE

IND

EX

GR

OW

TH

Size of company

Value and growth

Region of the world

For illustration purposes only. Past performance is not an indication of future performance.

How Funds are Different

Growth

Inflation

InflationaryUpturn

StagflationRecession

EmergingMarkets Equity

BondsTIPS Bonds 

Stocks

EmergingMarkets Debt

Cash HardAssets

For illustration purposes only. Past performance is not an indication of future performance.

Active vs. Passive (Index)

Try to beat the market Try to match the market

More expensive

Historically better in down markets*

Less expensive

Historically better in up markets*

*Historically passive outperforms active management in periods of economic expansion. Additional supporting details available upon request.

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For illustration purposes only. Past performance is not an indication of future performance.

Lifestyle Allocation Funds

Growth

Static

Balanced

Income

All in one

Active and passive

For illustration purposes only. Past performance is not an indication of future performance.

Target Retirement Date

Age based All in oneActive and passiveGlide path

For illustration purposes only. Past performance is not an indication of future performance.

Evaluating Mutual Funds

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For illustration purposes only. Past performance is not an indication of future performance.

Past Performance is the best indication of future returns?

A. True

B. False

For illustration purposes only. Past performance is not an indication of future performance.

B. FALSE

For illustration purposes only. Past performance is not an indication of future performance.

Morningstar.com

Fidelity Contrafund (FCNTX)

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For illustration purposes only. Past performance is not an indication of future performance.

Fund Manager Experience

$2,500

1 star = worst 2 star = below average3 star = average

4 star = above average5 star = best

For illustration purposes only. Past performance is not an indication of future performance.

Fund Manager Experience

For illustration purposes only. Past performance is not an indication of future performance.

Fees

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For illustration purposes only. Past performance is not an indication of future performance.

Fees

For illustration purposes only. Past performance is not an indication of future performance.

Measuring Volatility

For illustration purposes only. Past performance is not an indication of future performance.

Benchmark

This is the benchmark. Comparing this mutual fund to anything else would likely not be an accurate comparison.

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For illustration purposes only. Past performance is not an indication of future performance.

R-Squared

Source: Investopedia.com

Indicates the usefulness of Beta score

Range: 0-100%

>85% performs like index

<70% performs unlike index

For illustration purposes only. Past performance is not an indication of future performance.

Beta

Source: Investopedia.com

Volatility compared to the market

1 = as volatile as the market

<1 = less volatile than market

1< = more volatile than market

Example = Beta of 1.02 means

2% more volatile than the market

For illustration purposes only. Past performance is not an indication of future performance.

Alpha

Source: Investopedia.com

Value a manager adds or subtracts

The more positive the better

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For illustration purposes only. Past performance is not an indication of future performance.

Performance

For illustration purposes only. Past performance is not an indication of future performance.

Performance

Presented net of feesAverage annualized

For illustration purposes only. Past performance is not an indication of future performance.

What We Covered Today

What a mutual fund is

How mutual funds are different

How to evaluate mutual funds

Morningstar.com

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For illustration purposes only. Past performance is not an indication of future performance.

MoneyAdvice@Work®

Call 866-232-6457 or visit moneyadviceatwork.com

to schedule a personal MoneyAdvice session.

@francisinv

Francis Investment Counsel does not provide legal or tax advice. As investment returns are variable, we cannot guarantee any certain investment return or result. Historical performance information has been compiled from sources we believe to be reliable, but we cannot guarantee its accuracy or completeness. Past performance is not a guarantee of future results.

For illustration purposes only. Past performance is not an indication of future performance.

Moneyadviceatwork.com/learnmore

For illustration purposes only. Past performance is not an indication of future performance.

Meet our Advisors!

Kelli SendCreative and Fun Educator,

Master Helper

Liz AidooLa diversidad es nuestra

fortaleza… Diversity is our Strength

Tim ShirkSurprised by Life,

Ready to Help

Art HarrisHopeful Helper

Eric HencleyFinancial Adventurer, Slayer of Pessimism

Matt VandreOptimistic Doer, Lively

Encourager

Jay VoigtMoney Sherpa, Strategy Guru