Incorrect Mutual Fund Charting On My Site

I was just looking at a chart today at Yahoo that did not make any sense. The chart compares Fidelity Low-Priced Stock Fund (FLPSX) with Legg Mason Value Trust (LMVTX). The problem is that over this period the former should have beaten the latter by a significant margin. According to this article at which I have referenced twice already, FLPSX had an 18.4% annualized return vs. 16.55% for LMVTX. Either the Yahoo chart is incorrect or the Forbes article is incorrect. Then it dawned on me, Yahoo is obviously just plotting the NAV which doesn’t take into account distributions! I found an article, “A Call for Decent Fund Charting,” that cleared things up for me.

Morningstar is apparently the only site that shows plots of total return on investment (besides mutual fund company websites, which only show performance for their own funds). Compare the data here for LMVTX with the data here for FLPSX. It gives FLPSX’s 10-year annualized return as 16.82% vs. 14.71% for LMVTX. That looks more like it! Over the same period in Yahoo, 1996-2006, we see a completely different picture (the incorrect picture).

On Morningstar it is not possible to compare two different funds on the same plot, so charting is useless in my opinion, except for comparing with the indexes and fund categories. The best solution is to look at figures like “n-Year Annualized Return” (see the Trailing Total returns section on Morningstar’s fund pages) at sites like Morningstar’s or on the mutual fund company’s pages themselves.

My apologies, as I have presented a few plots comparing mutual funds from Yahoo in the past. I guess this technically applies to ETFs and stocks as well, basically anything with distributions. I will try to go back and fix some of the old posts that used plots from Yahoo to compare past performance.

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