By Scott Ronalds

Fund (as in mutual) has become a dirty word. I was reminded of this the other day when Tom was lamenting over all the negative connotations associated with mutual funds.

What was once a beautiful concept – investors pooling their money in a shared vision of investing in stocks, bonds or other assets through the expertise and guidance of an experienced professional – has been tainted by high fees, over-diversification, poor performance, index hugging and questionable client-manager alignment. Not to mention a lack of sex appeal.

But the mutual fund is still the most effective vehicle for most individuals to achieve their investment objectives. It just has to be structured right.

In an environment of record low bond yields, high-flying (and free-falling) IPOs, volatile commodity prices, and exotic ETFs, investors may soon be longing once again for experienced, professional management at a reasonable cost. As dull as it may be.

I for one can think of a few other four-letter words that may prove to be much more offensive in coming years. Bond, debt, and gold come to mind.