Gorilla and King Portfolio candidates - Moderated Message Board

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Strategies & Market Trends : Gorilla and King Portfolio candidates - Moderated

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To: Jay who wrote (113)	10/28/2003 1:32:47 PM
From: Mathemagician	Read Replies (2) of 2955

Mutual funds are generally intended for long-term investors, and prices are generally set once a day. But if allowed to move quickly in and out of funds, investors can sometimes take advantage of late-day information before the new prices are set. Essentially, profits won by market timers skim money at least indirectly from others who own shares in the funds. The others who own shares in the funds have access to the same information and are free to make the same trades as the "skimmers". For whatever reason, they choose not to. What these guys are in trouble for is "allowing market-timing trades despite company policies that prohibit them". If they didn't work for Putnam, there would be no suit. If you ('you' in general, not Jay in particular) believe that any market timing that profits at the expense of other traders is somehow immoral then you'd better start protesting the futures markets, which is a zero sum game (excluding commissions and fees) meaning that all trading profits come directly from the accounts of other investors. <font face=wingdings>e</font>

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