Lipper's Tom Roseen is sitting in for Don Cassidy this week on the Business for Breakfast program.Tom is a Lipper Research Analyst specializing in portfolio and quantitative research along with fund performance.
Lipper Senior Research Analyst Tom Roseen on KTLK AM-760; Thursday, September 6, 2001
Q. Well, Tom, Labor Day has come already, so that must mean you folks atLipper have surveyed what happened in mutual funds in August...A. And it's pretty much a case of "surveying the damage," at least instock funds.
Q. I'll bet! Now, how much were the major averages off in August?
A.
- Dow Jones Ind. Average -5.45
- S&P 500 Ind. -6.41
- NASDAQ Composite -10.94
Q. So, what were the best-performing fund types, and how did they do?
A.
- Defensive oriented investment seemed to do best
- Gold Oriented Funds 5.13
- Real Estate Funds 2.90
Although still in the negative for the month, value funds beat growth;however, 34 of the 36 Equity investment objectives were in negativeterritory (overall the U.S. Diversified Equity funds were down 5.59 percenton average and Sector Equity funds were down 6.22 percent overall.
If you take a look at the top-ten performing funds for the month,every single one was either a contrarian or bear fund. The top performerwas the Profunds Ultra-Short OTC fund 26.55% in August.
Q. And what were the worst laggard groups in August?
A. Aggressive, tech/growth-oriented stock funds
- Telecommunication Funds -13.59
- Science & Technology Funds -13.48
- Multi-cap Growth Funds -8.57 followed closely by
- Large-cap Growth Funds -8.13
Q. But bond funds did a lot better?
A. Definitely. Soft economy means lower rates. And lower rates equate tohigher bond prices. Actually, there appears to be global bond rally goingon. Our top three bond fund groups are in the world taxable fixed incomemacro-objective.
Emerging Markets Debt put up a stellar 3.76% increase for the monthfollowed by:
- International Income 3.08%
- Global Income funds 2.16%
Q. And domestic bond funds?
A. General Domestic Taxable Fixed Income funds have been doing great aswell!
Target Maturity (1.87), Flexible Income (1.66), and General US Treasuryfunds (1.62) have all posted very reasonable returns. In fact, ourpreliminary numbers show that all 77 taxable and tax-exempt fixed incomeinvestment objectives posted positive returns in August.
Q. How about some results year-to-date, Tom?
A. Not a very pretty picture, but actually some occasional bright spots.
- Gold Oriented Funds 12.97
- Small-cap Value Funds 12.22
- Real Estate Funds 8.94
- Mid-cap Value Funds 5.85
- Troubled groups
- Science & Technology Funds -40.82
- Telecommunication Funds -38.29
- Multi-cap Growth Funds -27.78
Q. What do you make of it all?
A. Clearly there has been a move towards defensive investment alternatives... REITs, contrarian and bear funds, and even Gold have posted respectablereturns. Perhaps the biggest untold story, here, is the global fixedincome bull market. Even the tax-exempt bond funds have rallied as ofrecent with California and Colorado Municipals on top for the month.
