Home > Dirty Advertising? The Hypothetical Back-Tested ETF Performance Loophole

Dirty Advertising? The Hypothetical Back-Tested ETF Performance Loophole

January 8th, 2013

The fund industry is notorious for comparing the performance of their products to the wrong benchmarks and even made-up benchmarks. This is done to make a fund’s performance appear to be superior relative to something — even if that something makes no sense. This decadent practice harms the credibility of an industry that has lost so much in recent years.

Sometimes, when an exchange-traded fund (ETF) doesn’t actually have performance, the fund provider will publish an index return that the ETF is attempting to follow. The index performance is then compared to other benchmarks so that investors can evaluate differences.

You can find the full “Forbes” article: HERE

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