Why people don't do their Homework?
Most of the fund managers I have encountered lacked in depth knowledge of my companies, which ranged from members of the FTSE 250 to an Aim-quoted group, because they simply did not exert themselves. Rather than conduct rigorous due diligence before investing, they seldom left their offices. Instead they relied on weak and frequently partisan analysis provided by brokers’ analysts, or on a 45-minute sales pitch by the investee company’s chief executive and finance director.
I cannot recall even one fund manager asking to visit our operations or meet more executives before investing. They therefore became shareholders in companies that they barely understood. Once in, few fund managers put in much effort to get to know us better. Although most companies welcome visits by fund managers, most of them are unwilling to leave London — unless it sounds like fun
Perhaps there are Funds like this ones that don't do their homework or don't have the money & resources to do the womework. They speak with the sell side and that 's it.
However i invest in two types of funds, Sector funds that only do one sector and know more than the managements about the company and quant funds that know zero about the companies but screen thousand of companies to find some characteristics that precede good performance.
Both can work.
To buy funds that do everything with few people and no money it's better to buy an ETF.
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