4 Reasons to Sell a Mutual Fund

Buy-and-hold is a great investing approach, but sometimes you just gotta let go.

When people say “breaking up is hard to do,” they’re not talking about how difficult it is to say goodbye to a poorly performing investment. But knowing when to sell a fund that’s gone astray is tricky, too. We’re not talking about index funds; you either want exposure to a particular slice of the market or you don’t, or you’ve found a cheaper option. But an actively managed fund poses a different set of questions. We’ve highlighted four traits that signal it may be time to sell. Any one of them might not be a sufficient cause to call it quits, but if a fund you hold has two or more of these qualities, you probably have reason to dump it.

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Nellie S. Huang
Senior Associate Editor, Kiplinger's Personal Finance

Nellie joined Kiplinger in August 2011 after a seven-year stint in Hong Kong. There, she worked for the Wall Street Journal Asia, where as lifestyle editor, she launched and edited Scene Asia, an online guide to food, wine, entertainment and the arts in Asia. Prior to that, she was an editor at Weekend Journal, the Friday lifestyle section of the Wall Street Journal Asia. Kiplinger isn't Nellie's first foray into personal finance: She has also worked at SmartMoney (rising from fact-checker to senior writer), and she was a senior editor at Money.