Many investors are drawn to buy funds that sit at or near the top of the performance league tables. But as the small print of adverts warns, performance can be a poor guide to prospects.

Investors who flocked to buy technology funds in 1999 and 2000 suffered badly as the bubble burst.

More recently, savers pumped billions of pounds into commercial property funds in 2006 and early 2007 on the back of strong growth, only to join the party too late and see the value of their investments slump.

Juliet Schooling, head of research at national investment adviser Chelsea Financial Services, says: ‘It is worrying that so many investors look only at what has performed well in the past year and decide that is where to head for their latest investment.’

Adrian Shandley, who runs independent adviser Premier Wealth Management in Southport, Merseyside, agrees. ‘You wouldn’t try to drive a car using just the rear view mirror, but many investors focus too much on past performance and not enough on looking ahead,’ he says.

Source: This is Money

The Daily Telegraph has teamed up with the Venture Navigator consortium of leading universities to allow you to test your business ideas online and improve your chances of success.

“We tackle ten different elements of the test below with Sir James Dyson, founder of eponymous home appliances group, and Virgin founder Sir Richard Branson among the entrepreneurs who have shared their own experiences of setting up and running hugely successful businesses.

Our top team of experts also includes Eileen Gallagher, co-founder of independent TV producer Shed Media; Martin Webb, the serial entrepreneur and presenter of Channel 4’s Risking It All; Claire Owen, founder of recruitment agency The SG Group; and Doug Richard, the technology entrepreneur and former Dragons’ Den panellist.” More

Take the test now

Source: Daily Telegraph

Many investors are drawn to buy funds that sit at or near the top of the performance league tables. But as the small print of adverts warns, performance can be a poor guide to prospects.

Investors who flocked to buy technology funds in 1999 and 2000 suffered badly as the bubble burst.

More recently, savers pumped billions of pounds into commercial property funds in 2006 and early 2007 on the back of strong growth, only to join the party too late and see the value of their investments slump.

Juliet Schooling, head of research at national investment adviser Chelsea Financial Services, says: ‘It is worrying that so many investors look only at what has performed well in the past year and decide that is where to head for their latest investment.’

Adrian Shandley, who runs independent adviser Premier Wealth Management in Southport, Merseyside, agrees. ‘You wouldn’t try to drive a car using just the rear view mirror, but many investors focus too much on past performance and not enough on looking ahead,’ he says. More

Source: This is Money