Here's how I put it. If someone believes active managers are worth the load and greater annual expense ratio they should really put their money where their mind is and keep 100% of their investments (or at least 100% of their equity asset allocation) with that manager and fund. If they start shopping positions around, unless one is a deliberate and well-informed asset category slicer-and-dicer (which is possible, for example a portfolio of low-ER US and Europe indexes supplemented with low-overlap active-managed specific specialty asset funds such as REITs and BRIC emerging market stocks, etc), they may find they've approximated the total stock market for 5% front end load and 2% annual ER when they could have had an index fund tracking "the total stock market" for no load and 0.2% per year. Naive investors think they have achieved diversification buying several active managed funds (and the paid brokers don't discourage this!). If the investor actually has diversification, they are paying a ton of money for it upfront and per year than they needed to and the total portfolio will do worse year over year. If they don't achieve diversification, why bother with multiple funds? Also, Harry's bit about ETF commission being like a load is technically correct but bologna on magnitude: Yes, a $9.95 discount brokerage trading commission a load, but on a $10,000 position, that's a 0.10% load on the front and the back. In comparison, the load on $10,000 of a class A mutual fund is going to be $500 not $20. If you are buying $1000 or $2000, go with the fund and not the ETF as the $9.95 is a 1% load.

"My stockbroker told me last week that you must have been getting paid by one of the no-load fund groups or their association. He told me that if you were right, load funds would have disappeared long ago." Yeah, and if No Doc mortgages were found to have a high rate of default no lender would offer them, right? That's the kind of thinking that's taken the whole Financial Industry to the brink. Meanwhile, the working man who dutifully puts his pre-tax deductions into his 401(k) can plan on working until he's dead, even if he lives to be 90+. All of these so called financial wizards should be quite warm for eternity!!