David Swensen Insight

Swensen mocks mutual fund industry: it is a marketing industry

Posted on: April 2, 2009

In a recent interview with Yale Alumni Magazine, David Swenen had this dialog with the reporter.

Yale Magazine: Unconventional Success delivered a scathing critique of the mutual-fund industry. You rightly pointed out that the vast majority of mutual funds charge high fees, trade too frequently, and under-perform the markets. How did the industry react?

Swensen: I’ve heard stories of people in the fund management business being irate about the book. That’s not surprising. The mutual fund industry is not an investment management industry. It’s a marketing industry. And if somebody interferes with your marketing, you’re not going to like that. So I was pleased to hear that there were senior people in the industry who were very, very unhappy with me and my book.

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