A Start-Stop-Start Month for Funds


November was a roller coaster of a month in which investors' enthusiasm for stocks rose, fell, and then rose again, ending the month little changed. The bull market's mid-month breather began as investors worried that all the positive economic news had already been priced into stocks and as they witnessed a scary spike in global terrorism. But by month's end, stocks were on the rise again as healthy retail sales over Thanksgiving weekend spurred hopes for continued strong consumer spending.

The benchmark Standard & Poor's 500-stock index gained a mere 0.9% in November, while the average diversified equity fund climbed 1.9%, according to data from S&P Fund Services. (See BW Online's Interactive Mutual Fund Scoreboard for complete results of more than 9,000 funds.)

Small caps continued to outperform large caps, although funds with a value-investing style outperformed growth in both cases. Small-cap value funds gained 3.6%, and small-cap growth funds climbed 3.1%. Large-cap value funds rose 1.4%, while large-cap growth funds inched up just 0.9%.

STRONG DEFENSE. Precious-metals funds were November's standouts, with a 12.3% run-up as the dollar weakened against the price of gold and foreign currencies. U.S. Global Gold Shares (USERX) was the top-performing fund for the month, with an 18.8% gain. In fact, the great majority of the top-performing 20 funds were in the precious-metals category.

Another defensive category, real estate, also performed well, rising 4.1% on average. But utilities and financial-sector funds both climbed just 1.1%. Technology funds, which have been on a tear this year (up 58% year-to-date), registered a tepid 1.8% gain. Communications funds, up 32.6% this year, climbed just 1% in November.

Europe and Latin America funds performed well, rising 4.3% and 4.1%, respectively. But funds that invest in Asia fared poorly. Japan funds fell 4.4% in the month. Diversified Pacific/Asia funds fell 2.2%. Fidelity Japan Small Company (FJSCX) lost 6.4% in the month. Overall, however, international equity funds rose 1.6%.

RISK REWARDED. On the fixed-income side, the average taxable bond fund returned 0.5%, while tax-free bond funds gained 1%. Riskier fixed-income categories fared the best. Convertibles climbed 2% on average, and emerging-market bond funds rose 1.6%. The worst-performing categories were short government bonds, which were flat, and intermediate government bonds, which scratched out a mere 0.1% increase.

All in all, November was a month where if you could handle the ups and downs, it paid to take a little risk.

Stone is a senior writer at BusinessWeek Online and covers the markets as a Street Wise columnist and mutual funds in her Mutual Funds Maven column

PHOTO URL:

http://www.businessweek.com/bwdaily/images/astone.jpg

PHOTO CAPTION:

Amey Stone is a senior writer at BusinessWeek Online

Funds Rated A in November:

ABN AMRO Veredus Aggressive Growth N

AIM Opportunities I A

AIM Real Estate A

AXP Precious Metals A

Aegis Value

Al Frank

Alpine US Real Estate Equity Y

Amer Century Glbl Gold Inv

Amer Century Real Estate Inv

Amer Century Sm Cap Vl Inv

Amer Century Vista Inv

Armada Small Cap Value I

Artisan Mid Cap

Artisan Small Cap Value

BNY Hamilton Sm Cap Gr Inv

Baron Growth

Baron Small Cap

Bjurman Barry Micro Cap Growth

BlackRock International Opportunities Inv A

BlackRock US Opportunities Inv B

Boston Partners Small Cap Value II Invest

Brazos Micro Cap Y

Bridgeway Aggressive Investors 1

Bridgeway Micro Cap Limited

Bridgeway Ultra Small Company

Bridgeway Ultra Small Company Market

Bruce

Buffalo Small Cap

CGM Focus

CGM Realty

CNI Charter RCB Small Cap Value R

CRM Small Cap Value Instl

Calamos Growth A

Cohen & Steers Special Equity

Columbia Acorn Select Z

Columbia Acorn Z

Columbia Small Cap Z

Conseco Equity Y

Delafield

Dreyfus Gr & Val Fds Midcap Value

Dreyfus Premier Emerging Markets A

Dreyfus Premier Greater China A

Driehaus Emerging Markets Growth

Eaton Vance Wldwd Hlth Sciences A

Emerald Select Banking & Finance A

Evergreen Precious Metals Holdings A

FBR Small Cap Financial A

FBR Small Cap Value A

FMC Strategic Value

FMI Focus

Fidelity Canada

Fidelity Japan Small Co

Fidelity Low Priced Stock

Fidelity New Millennium

Fidelity Real Estate Investment

Fidelity Small Cap Stock

Fifth Third Micro Cap Value Instl

First American Real Estate Securities Y

First American Sm Cap Select Y

First American Small Cap Growth Opport Y

First Eagle Global A

First Eagle Gold

First Eagle Overseas A

Franklin Gold & Precious Metals A

Franklin Microcap Value

Fremont US Micro Cap

Fremont US Micro Cap Instl

GMO Emerging Countries III

Gabelli Gold

Gabelli Westwood Mighty Mites AAA

Goldman Sachs Small Cap Value A

Harding Loevner Emerging Markets

Hartford Mid Cap A

Heartland Value

Hennessy Cornerstone Growth

Hotchkis & Wiley Mid-Cap Value I

Hotchkis & Wiley Small Cap Value I

ICM/Isabelle Small Cap Value Inv

ICON Energy

ICON Information Technology

IMS Capital Value

ING Precious Metals

ING Russia A

INVESCO Energy Inv

INVESCO Gold & Precious Metals Inv

Ivy Global Natural Res A

JPMorgan Mid Cap Value I

Janus Mid Cap Value Inv

Janus Small Cap Value Inv

Jennison Natural Resources A

Legg Mason Glbl Tr Emerging Mkts Prim

Longleaf Partners International

Lord Abbett Small Cap Value A

MFS International New Discovery A

MTB Small Cap Growth A

Matthews Asian Growth & Income

Matthews China

Matthews Korea

Matthews Pacific Tiger

Meridian Growth

Meridian Value

Merrill Lynch Global Small Cap C

Merrill Lynch Master Small Cap Value B

Morgan Stanley Instl Small Company Gr B

Munder Micro Cap Equity A

Munder Small Cap Value Y

NI Numeric Investors Emerging Growth

NI Numeric Investors Small Cap Value

Navellier Perf Mid Cap Growth

Needham Growth

Neuberger Berman Genesis Inv

OCM Gold

Oakmark International Small Cap I

Oakmark Select I

Oberweis Emerging Growth

Oberweis Micro Cap

Olstein Financial Alert C

Oppenheimer Developing Markets A

Oppenheimer Gold & Special Minerals A

Osterweis

PIMCO PEA Renaissance A

PIMCO RCM Biotechnology D

Perkins Discovery

Perritt Micro Cap Opportunities

Phoenix-Duff & Phelps Real Estate Sec A

Pioneer Small Cap Value A

Quaker Aggressive Growth A

RS Contrarian Value

RS Diversified Growth

RS Global Natural Resources

RS Partners

Reserve Private Eqty Small Cap Growth R

Rockland Small Cap Growth

Royce Low Priced Stock

Royce Micro-Cap Inv

Royce Opportunity Inv

Royce Pennsylvania Mutual Inv

Royce Select

Royce Special Equity

Royce TrustShares Inv

Scudder Gold & Precious Metals S

Scudder Micro Cap Invest

Security Capital US Real Estate

Security Mid Cap Value A

Select Energy Service

Select Gold

Select Medical Systems & Equipment

Sentinel Small Company A

State Street Research Aurora A

State Street Research Global Resources A

Strategic Partners Real Estate Securities B

Strong Advisor Small Cap Value Z

T Rowe Price Intl Discovery

T Rowe Price Real Estate

T Rowe Price Small Cap Value

TCW Galileo Opportunity N

TCW Galileo Value Opportunities I

Third Avenue Real Estate Value

Third Millennium Russia

Tocqueville Gold

Tocqueville Small Cap Value

Touchstone Emerging Growth A

Turner Micro Cap Growth

Turner Small Cap Value

UBS US Small Cap Growth Y

US Global Accolade Eastern European

US Global Inv Global Resources

US Global Inv Gold Shares

US Global Inv World Prec Minerals

USAA Precious Metals & Minerals

Undiscovered Managers REIT Instl

Value Line Emerging Opportunities

Van Eck Intl Investors Gold A

Vanguard Capital Opportunity

Vanguard Precious Metals

Wasatch Core Growth

Wasatch Micro Cap

Wasatch Small Cap Growth

Wasatch Small Cap Value

Wasatch Ultra Growth

Westport Select Cap I

iShares MSCI Malaysia Index


The Good Business Issue
LIMITED-TIME OFFER SUBSCRIBE NOW
 
blog comments powered by Disqus