This is a single country unit trust extracted from the factsheet as on 31 July 2008:

The long term return over 5 and 3 years tracks the benchmark. But the short term return over the past YTD and 1 year return underperforms the benchmark terribily. Look at the 1 year return, the fund return was -33% while the index -18.1%. Imagine losing nearly 15% of the investment due to the fund manager "skill." How come it can track the benchmark over a longer period? The fund has very high beta. During the good times, the fund did better than the index but when the bad time comes, the fund manager "forgot" to lower its beta and as a result lost worst than the index. Is there real skill? Judging from its long term return since 28 April 2000 inception, the return before sales charge was merely tracking the index. It has no alpha at all. Investor is better off buying into the index. At least the index fund returns will have a guaranteed beta of 1 and will never underperform like 15% over 1 year!! Lesson ? Avoid such unit trust, buy the index. I told many of my clients last year to switch to index funds but many people refuse because they cannot understand how an index fund can make money over a long term. I spent countless hours and emails elaborating the advantages of index funds but very few believed in me. I have given up on these clients who refused to believe. One reasaon could be they don't want to do research. I supply them with endless research materials but I think nobody reads them. Laziness is the start of one' financial failure.