Best Mutual Funds For Whom?

"The best mutual funds" (Cover Story, Feb. 6) states that the best funds were not the ones with the biggest total returns but the ones that gave the best "risk-adjusted" performance. For investors with long time horizons (for example, college funding for young children or long-term retirement planning), volatility is irrelevant. Consciously accepting lower returns than could otherwise be achieved just to have less volatility will virtually guarantee less money at the time when it will be needed.

The best way to evaluate any long-range investment program is by total return. Only when a substantial withdrawal is contemplated over the near term should long-term investments be shifted to lower-returning vehicles to avoid the risk of being forced to cash out at an inopportune moment. The most serious problem in most Individual Retirement Accounts and 401(k)-type accounts is keeping long-term money in inappropriate (read: lower total return) investments such as money funds and bond funds.

Paul M. Price

Senior Vice-President

Wheat First Butcher Singer

Chadds Ford, Pa.