For the past 11 years, BUSINESS WEEK has given investors the last word on U.S. mutual funds in our annual Mutual Fund Scoreboard Special Reports. Now, we are giving the same thoughtful scrutiny to the $1 trillion offshore fund market, the American fund industry's global counterpart.
Inside this week's issue you'll find our exclusive Best Offshore Funds Special Report covering the 500 largest offshore funds sold to investors around the world from such money-management centers as Luxembourg, Dublin, Bermuda, and Hong Kong. Based on data compiled by Micropal Ltd., a London-based fund research organization, and analysis by Senior Writer William Glasgall and Paris Bureau Chief Bill Javetski, we present a wealth of information about how the funds have performed in 1996 and over the past five years.
But we offer investors much more than performance figures alone. In a market where detailed information on many funds is often hard to come by, we take the funds apart and put them under a microscope to ferret out such important things as a fund's largest holding and its management and sales charges. We even give telephone and fax numbers for every fund. And then we give you what you need the most to make sensible investment choices. We assign ratings to the funds to give you an idea of their true quality.
To earn top ratings, funds have to do more than earn high returns. They also have to show the highest returns after adjusting for the risk managers are taking and in relationship to the performance of the Financial Times/Standard & Poor's World Index of stocks. So we can see how funds perform in a variety of market conditions, they also must have five-year track records before they can earn ratings.
Our Special Report is more than mere numbers, however. We also give you investment strategies prepared by four leading financial advisers. We provide you with clues on where stocks may be headed in 1997 (one hint: The torrid U.S. bull market may still have room to rise further). And we get inside the offshore fund industry to reveal some of the things that money managers would rather keep to themselves, like their cushy fees and a woeful lack of disclosure to investors that may have contributed to some nasty scandals over the summer.
The Scoreboard is part of our continuing effort to broaden our coverage of international finance and markets. We figure that the more you know about your investments, the better off you'll be. And we hope that this Scoreboard gets you off to a good start.