In a stock market this rocky, it's only natural to want a savvy portfolio manager. And judging by the quarterly reports that most investors get at the end of the year, some managers may in fact look pretty smart -- after all, as the fund statements suggest, these managers have loaded up on top performers like Apple, Amazon.com and McDonald's.

But such disclosures could well be giving investors a decidedly wrong impression. The problem: The statements don't detail all of a fund's trading activity; they're just a snapshot of what it owned on a single day. This can lead to a little-noticed wrinkle that critics call "window dressing." That's when portfolio managers rejigger their holdings at the last moment to obscure recent mistakes or to jump on winners' bandwagons.

To be sure, it's unclear how widespread the practice is. The Investment Company Institute, the fund industry's trade group, dismisses concerns as more myth than reality. But a number of academic papers that use mathematical models to detect unusual patterns in fund returns suggest otherwise. One recent Iowa State University study found that for at least a minority of funds, such last-minute primping helps entice would-be investors. "All else being the same, the managers that window dress attract more money," says author Xiaolu Wang.

Figuring out whether a particular fund is dressing up its portfolio isn't easy. But there are flags to look for: Some portfolio statistics, such as turnover -- the percentage of a fund's holdings that are traded each year -- give investors a broad indication of whether managers are churning stocks. Websites like Morningstar's compare the latest quarterly reports with past ones, which can highlight trades in and out of fashionable names.

Experts say it's even worth double-checking funds that recently loaded up on these stocks, perhaps by coincidence. Giant stock fund Growth Fund of America, for example, recently boosted its stake in highfliers Apple and Amazon.com by 26 and 42 percent, respectively. Partly as a result of that buying, the stocks have become two of the fund's top three holdings. At the same time, the fund cut positions in other big holdings Oracle and Microsoft, both more or less flat. An American Funds spokesperson declined to comment on specific trades but said the firm's policies eliminate incentives to make short-term investing decisions.

One bit of good news for investors: The Web has been putting pressure on fund companies to publish more frequent and detailed information. At the same time, the proliferation of ETFs, which disclose holdings daily, means more options. Finally, no amount of prettying can turn average investment decisions into inspired ones. "If you buy Apple today, it doesn't change your past performance," says Morningstar analyst Russel Kinnel.