A Guaranteed Way to Match the Market's Top-Performing Fund
If you (or your financial adviser) are spending all your time looking for the VERY BEST investment out there, you might be missing out on a sure thing.


Who doesn’t want the best? Of course, we all do. But sometimes our search for the very best investments can lead us astray if we lose sight of the big picture. While you’re sifting through a haystack worth of investments to find that golden needle, you just may be overlooking something even more important that ends up costing you a lot.
According to Morningstar, the top-performing large-cap U.S. equity fund over the last 15 years is the AMG Yacktman Focused Fund (Ticker: YAFFX). As of May 2017, the fund has had an annualized return of 11.06% over the last 15 years, beating the S&P 500 index by 3.5 percentage points.
Of course, the important question we all want the answer to is not who has been the best fund manager, but instead who will be the next best fund manager.

Sign up for Kiplinger’s Free E-Newsletters
Profit and prosper with the best of expert advice on investing, taxes, retirement, personal finance and more - straight to your e-mail.
Profit and prosper with the best of expert advice - straight to your e-mail.
But picking the next great investment manager is hard, and it becomes more unlikely the longer you hold your investment. According to a recent study by S&P, 92% of large cap fund managers have underperformed the S&P 500 over the last 15 years.
The Hottest Fund Out There Can’t Beat This Strategy
Part of any adviser’s or investor’s job is to allocate their investments. As an adviser, I consider it a big part of my work to find the best funds for my clients. So, I wondered, what should I be doing to try and find the next AMG Yacktman?
Some may jump to finding the manager with the next hot quantitative algorithm, bury their nose in prospectuses and annual reports, or try to book golf outings with fund managers and CEOs. But I think I found a better, much easier, much more certain way of keeping up with AMG Yacktman, (or whoever the next top dog is): Save an extra $145 per month.
Consider an investor who, starting in 2002, saved $5,500 per year into AMG Yacktman’s fund (listed as Investment No. 2 in the chart below), and another investor who saved $7,250 per year (an extra $145.83 per month) into a basic, low-cost S&P 500 index fund (Investment No. 1 in the chart below). Who came out on top after 15 years?
The green line (Investment No. 3) in the chart above is the performance of the average large-cap U.S. equity fund, per the S&P study cited above.
For all the blood, sweat and tears that go into the hundreds of large-cap equity funds in an attempt to produce returns that best the S&P 500, isn’t it ironic that the effective long-term performance for a small investor in the top-performing large-cap fund can be matched by a small investor who is willing to save just a little bit more every month?
And yet, a majority of investors and financial advisers will devote countless hours and dollars in an attempt to find the few needles in Wall Street’s legendary haystack that will outperform.
Of course, there is a bigger point than just exactly how much money you need to save to match AMG Yacktman’s performance. The exact numbers will change if you consider different time horizons or amounts to be invested. You can play around with specific numbers with a compound interest calculator, like the one we used above here: http://www.hyllandcapital.com/blog/compound-interest-rate-calculator.
The Key Takeaway for Investors
The bigger point is that time spent focusing on elements of your financial plan that are within your control will yield much more certain, and very likely better, results for your portfolio.
What is more likely to positively affect the long-term value of your portfolio? Spending hours, days or even months evaluating fund managers, with a hope of picking the best one over the next 15 years? With history as our guide, we know you have only a small chance of succeeding at this option…
Or instead, should you focus your attention on your own finances and find a way to save a little extra every month?
Increasing your saving rate, no matter how much, has a 100% chance of increasing the value of your portfolio. No amount of investment research will yield the same certainty.
How that Might Apply to Your Financial Advice
As a financial adviser myself, is my time better spent evaluating fund managers? Or finding ways to save clients $145? My guess is I am much more likely to be successful finding $145 in savings in investment fees, taxes and spending rather than finding the most successful fund manager for the next 15 years.
If the next 15 years is anything like the last, the best use of your time will likely be spent doing the same.
Profit and prosper with the best of Kiplinger's advice on investing, taxes, retirement, personal finance and much more. Delivered daily. Enter your email in the box and click Sign Me Up.

Matt is the founder of Hylland Capital Management, a fee-only, virtually based financial planning and investment advisory firm designed for today's young professionals. Matt is a member of the XY Planning Network.
-
Already Hit Your 401(k) Limit in 2025? Here's What to Do Next
Maxed out your 401(k) contributions, but still want to tuck away money for retirement? Here are seven ways you can take advantage of being a super saver.
-
Ford Warns $3 Billion Tariff Bill Will Cut Profits and Pressure Prices in 2025
Ford now expects a $3 billion tariff hit this year — pushing up costs on parts, altering vehicle pricing and narrowing dealer discounts even as sales stay strong.
-
How Much Income Will an Indexed Annuity Get You? An Annuities Expert Lays Out the Numbers
Guaranteed lifetime income sounds great, but how much will it be? Several factors determine your future payout on indexed annuities with an income rider.
-
Financial Fact vs Fiction: Why Inflation Is Lower, But Prices Are Not
Do you think bonds protect you from stock losses? Are you confident your assets will go to your intended heirs if all you have is a will? Think again — and read on for other myths that could be leading you astray.
-
I'm a Personal Finance Expert: Here's the Truth About Using AI to Plan Your Retirement
AI can be a useful tool, but it often gets important financial information wrong. It also can't emulate the empathy, judgment and personal connection you can get with a human being.
-
You Don't Have to Be Wealthy to Need a Wealth Manager
Navigating complex financial decisions is hard on your own, no matter how much money you have. A wealth manager can provide comprehensive financial planning, investment management, risk management and more.
-
Despite Tariffs, These Investment Experts Are Bullish on European Equities
European equities were one of the better-performing investments during the first half of 2025. They could be a good long-term prospect for U.S. investors needing to diversify, according to these investment managers.
-
How Do You Know You Are Ready for a Gray Divorce? 15 Yes-or-No Questions
As more people 50 and older get divorced, many splits are initiated by women who want a new path. Answer these 15 questions to see if you might need to think about how you should move forward.
-
'Buy Now, Pay Later' for Everyday Spending? This Financial Pro Thinks It's Risky
'Buy Now, Pay Later' apps can get you out of a jam when you need money quickly. But using them regularly for small purchases could create problems.
-
Five Things to Consider Before Rolling Your 401(k) into a Roth IRA
Converting at least some of an old 401(k) to a Roth IRA can offer long-term tax benefits and retirement flexibility, especially if you anticipate being in a higher tax bracket later or wish to leave a tax-free legacy.