Excerpted from Bogle on Mutual Funds by John C. Bogle, pages 76-77

Too many investors select a common stock fund based solely on its past performance record. The record provided by the fund sponsor is usually a chronicle of championship results for one or more of its funds, carefully selected and accompanied by braggadocio about being the top-performing fund for some particular period. Reports by the financial press typically lionize the portfolio managers who had the best records (i.e., achieved the largest gains) during the previous quarter or year or even longer. This myopic focus on past performance is not helpful. It is a flawed and counterproductive way to select a mutual fund.

There is, however, a place for the evaluation of past performance in the fund selection process. But it should come only after a review of the fund's principal structural characteristics.