How can the majority of these companies continue to justify running the enormous funds they do (often measured in billions) and produce such appalling returns AND TAKE SUCH BIG FEES FOR DOING SO?

We believe that it would not be unfair to suggest that these funds should be renamed mismanaged funds. Investors have handed their money and, in effect, trust to these companies to deliver something back in return for their expertise and entrustment. What do the companies do? Charge the investor/saver for looking after the money and producing a return that the investor could get for no cost simply by sticking the money in a bank account.

Who is to blame? There is probably an argument for suggesting the investor themselves should pay more attention, demand more and be more ruthless with moving their money, there could well be an argument to suggest that advisers who leave their clients in such funds should be judged culpable, but in reality the blame for this must lie with the fund managers of these so called managed funds. We should also ask what about the bosses of these companies? What are they doing about this?

Whatever the reason, wherever the blame should or does lie, the simple fact is that this is not a snapshot, this position has lasted for years; however - such appalling relative performance used to get masked by the more positive returns achieved in former periods. After all if, for example, a managed fund produced 100% over 10 years (and there have been periods in the not too distant past when this may have been the case) and average returns were 130%, investors/savers didn’t worry too much, even though the underperformance was still there, because the absolute performance was OK.

It is this very difficult market which exposes the true extent of the failure of these managed funds. Investors should start to get out of them at the earliest possible opportunity and find better solutions.