For individuals with high consumption, choosing a fund that will yield long-term profits is not merely about pursuing previous performance or trendy options. It involves recognizing funds that fit your financial ambitions, remain stable through various market conditions, and expand consistently without the need for frequent monitoring. The ideal fund serves as a quiet partner in wealth accumulation, supporting your current lifestyle while safeguarding your future—if you know the indicators to look for.

Look Beyond "Star Manager" Hype

Numerous investors become overly focused on funds managed by "star managers," yet the success of an individual is often short-lived. It is beneficial to consider the stability of the fund’s team and the investment strategy. A fund that possesses a stable team (with an average tenure exceeding five years) and a consistent, methodical approach (such as value investing that involves thorough fundamental analysis) proves to be more dependable than one that relies on a single high-profile manager. Consistent teams are better equipped to respond to market fluctuations, ensuring the long-term strategy remains effective.

Do not limit your review to just the published expense ratio—look for additional expenses such as transaction fees, redemption fees, and administrative costs. These can accumulate over time: a fund with a stated ratio of 1.5% but hidden expenses of 0.8% effectively amounts to a total cost of 2.3%, which detracts from profits. Choose funds with open, comprehensive fee structures, even if their initial ratio appears a bit higher. Over a span of twenty years, reduced hidden fees could enhance your overall returns by 10-15%.

Align with "Thematic Resilience"

Select funds that are associated with enduring, resilient themes rather than temporary fads. Long-term themes like sustainable luxury, international healthcare innovation, or AI-powered productivity possess growth potential over several decades, unlike fashionable sectors that tend to rise dramatically and then fall. For instance, a fund concentrating on luxury brands that embrace strong ESG principles (like ethical sourcing and circular economic models) merges your lifestyle preferences with lasting market demand, ensuring relevance and profitability for many years.

Evaluate "Cash Management" Discipline

A fund’s cash holdings can indicate its discipline. Steer clear of funds that maintain excessive cash reserves (greater than 15%) during rising markets, as they forego opportunities for growth. On the other hand, funds that remain fully invested during declining markets risk significant losses. Search for funds that strategically manage cash levels: keeping 5-10% cash during bull markets to take advantage of price drops, and 10-15% in bear markets to safeguard capital. This approach demonstrates prudence and flexibility, which are essential for sustained success.

Check "Shareholder Alignment"

Fund managers who have their own capital invested in the fund (commonly referred to as having "skin in the game") possess stronger motivation to perform well. Seek out funds where the management team holds 5% or more of the fund’s assets, as this aligns their goals with your interests. Moreover, avoid funds that excessively issue new shares to increase assets under management (AUM); this dilutes returns. A fund that places emphasis on existing shareholders over rapid AUM expansion is more likely to provide steady long-term gains.

Selecting a profitable fund for the long run is about careful consideration and thorough research rather than mere chance. By avoiding the allure of star managers, focusing on low volatility, revealing hidden expenses, aligning with resilient themes, assessing cash management practices, and ensuring shareholder alignment, you can choose a fund that scales with your wealth objectives. It is not merely about identifying the "next big thing"—it is about finding a reliable, strategic ally in transforming time into wealth, allowing you to concentrate on enjoying the life your financial achievements facilitate.

（Writer：Frid）