Investors who pick stocks on their own without the help of a firm or adviser usually end up making more money, thanks to savings on fees and commissions, according to a recent study. The authors, Professors Daniel Bergstresser and Peter Tufano of Harvard Business School and John Chambers of the University of Oregon, wrote, “It is unlikely that the benefits of brokers lay in their superior mutual fund choices, asset allocation decisions or superior cost management for the investor.” The study of 4,000 mutual funds found that the funds selected by investors returned about $8.8 billion more than the funds picked by brokerages or advisers. “The biggest reasons broker-sold funds are underperforming,” say the authors, “is that the investor pays so much in fees.” Another reason cited is that brokerages often push their in-house funds, which are not always the best performers.
