It’s not just about performance. By Nellie S. Huang, Senior Associate Editor From Kiplinger's Personal Finance, June 2014 Knowing when to unload a fund is tricky. In fact, choosing a fund to buy is probably an easier process. But just as you should have a checklist for buying, a checklist for selling can help, too. Here are five factors to consider.Tool: Mutual Fund Finder A key manager leaves. If a manager has been integral to a fund’s success, his or her departure may be a sign that it’s time to walk away. Such was the advice we gave when the manager of T. Rowe Price Health Sciences left last year. And we’re keeping a watchful eye on another Price fund, Small-Cap Value; its longtime manager, Preston Athey, is retiring at the end of June. The fund grows too large. Size matters. Smaller is better, especially with funds that focus on small or midsize companies. Otherwise, when such funds with too much money make big trades, they risk moving share prices—up when buying, down when selling—in ways that can hurt results. But asset bloat can also trip up big-company funds, so last month we ousted Fidelity Contrafund from the Kiplinger 25. Advertisement The fund consistently underperforms. This is a thorny issue: How badly, and for how long, does a fund have to lag before it’s time to sell? One abysmal year may give you pause, unless, of course, it’s preceded by several solid years and the fund’s investing strategy hasn’t changed. But consistently bad performance over three or four consecutive years that drags down a fund’s long-term record is a red flag. The environment changes. We don’t advocate market timing, but it’s hard to ignore some big-picture issues. For instance, starting in 1981, interest rates began a steady slide. Now, with rates more likely to rise than fall, many bond funds are vulnerable (rates and bond prices generally move in opposite directions). Funds that invest in long-term bonds are especially at risk. It’s a good time to sell them. The fund’s strategy changes. A fund can shift its focus in ways that clash with your goals. Fairholme Fund, once more diversified, now looks a lot like a financial-sector fund. Look at the holdings in your fund to make sure it fits with your goals and your portfolio. If it doesn’t, consider selling. Here are some examples of how we've put these principles into action. If you hold any of these six funds, consider selling. Advertisement Fidelity Low-Priced Stock (symbol FLPSX). With $48 billion in assets, Low-Priced is more than 30 times bigger than the average midsize-company fund. Harbor International (HIINX). The fund has lagged its benchmark since the death of longtime manager Hakan Castegren in October 2010. Janus Triton (JATTX), Janus Venture (JAVTX). Managers Chad Meade and Brian Schaub left these two small-company funds in 2013, after seven years of generally good returns. Royce Low-Priced Stock (RYLPX). Over the past three years through April 4, the fund trailed the typical small-company stock fund by an average of 13.1 percentage points per year. Ouch! Third Avenue Value (TVFVX). What was once a fund that focused on small U.S. companies is now a global fund, with 41% of its assets invested in Asia.