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It is always best to get the most out of one’s invested capital. One way of doing it is by cutting down on the expenses that investors have to bear for owning or selling mutual funds. So, buying funds that carry no sales is the best option. Sales loads are one-time fees that investors pay either at the time of purchase or when units are redeemed. The importance of sales load was all the more felt in the third quarter, when the key benchmarks posted their worst quarterly performance in four years. Just 17% of the mutual funds managed to finish in the green in the third quarter. This was a slump from 41% in the second quarter, which was again a sharp fall from 87% of the funds ending in the positive territory in the first quarter. Separately, a JPMorgan equity strategy note revealed that 67% of mutual funds underperformed their benchmarks in the third quarter. Around 34% of the funds underperformed their peers by a minimum of 250 basis points. The Dow, S&P 500 and Nasdaq declined 7.6%, 7% and 7.4%, respectively. In such torrid times, the list of best-gaining mutual funds for the quarter is dominated by no load mutual funds. Robust gains were restricted to Bear Market funds in the third quarter, and were followed by modest gains in other categories. However, the no load funds were unfazed, as they had enough representation in most of the categories. Among the top 100 performers in the third quarter, 85 funds carried no sales load. The best-performing fund in the quarter, ProFunds UltraShort Latin America Fund Inv (MUTF: UFPIX ), gained 67.1%, and needless to mention, it is a no load mutual fund. Comparative Study: No Load Funds’ Q3 Show Out of the 15,129 no load funds we studied, 2, 316 funds posted positive returns in the third quarter. The average gain for these funds came at 1.6%. Among the top 100 performers, the average gain was a significant 12.9%. This is a quite a feat for the top 100 funds that almost reached the top-performing category Bear Market’s quarterly gain of 13.1%. It was followed by Long Government and Long-Term Bond categories’ gains of respectively 4.3% and 1.7%. The disparity in gains among the categories is indicative of how tough a quarter it was for funds. The average gain for the top 100 no load funds in the second quarter was 8.9%. The average gain of the top 100 no load funds also outperformed the average 4.1% gain of the top 100 funds that carry sales load. The load-adjusted return for these funds would again bring down the 4.1% average return. Moreover, the best-performing no-load fund’s quarterly gain of 67.1% far outpaced the top-performing fund with sales load, Rydex Inverse Emerging Markets 2X Strategy Fund A (MUTF: RYWWX ), which gained 43%. RYWWX carries a maximum front-end sales load of 4.75%. (Note: These numbers include same mutual funds of varied classes) Top 15 No-Load Mutual Fund Performers Below we present the top 15 no load mutual funds with the best returns in 3Q of 2015: Fund Name Objective Description Q3 Total Return Q3% Rank vs. Obj. YTD Total Return % Yield Expense Ratio Minimum Initial Investment ($) Beta vs. S&P 500 Rydex Invr Emerging Mrkts 2X Str H Foreign 43.03 1 37.47 0 1.73 2500 -0.27 Rydex Inverse Russell 2000 2x Strat H Growth 24.5 1 8.81 0 1.82 2500 -2.4 Rydex Inverse Russell 2000 Strat H Growth 11.99 1 5.09 0 1.7 2500 -1.2 Rydex Inverse Dow 2X H Agg Growth 11.6 2 8.14 0 1.84 2500 -2.16 Rydex Inverse S&P 500 2x Str H Growth 10.24 1 5.08 0 1.77 2500 -2.02 Gabelli Comstock Capital Value AAA Flexible 10.05 1 3.3 0 2.42 1000 -0.96 Federated Prudent Bear C Growth 7.93 1 0.49 0 2.51 1500 -0.73 Rydex Inverse Mid Cap Strategy H Growth 7.86 1 2.42 0 1.65 2500 -0.97 ATAC Inflation Rotation Investor AssetAlloc 7.33 1 11.69 0.32 1.74 2500 -0.03 Arrow Managed Future Trend C AssetAlloc 7.22 1 4.09 0 2.91 5000 0.19 Rydex Govt Long Bond 1.2x Str Inv Government 6.8 1 -2.16 1.08 0.95 2500 -0.1 GAMCO Mathers Fund AAA Flexible 6.12 2 1.71 0 4.6 1000 -0.53 Fidelity Spartan Long Treas Inv Government 5.49 1 — 2.55 0.2 2500 -0.06 Goldman Sachs Managed Futures C AssetAlloc 5.46 1 12.27 0 2.26 1000 -0.07 Vanguard Long-Term Treasury Inv Government 5.44 2 0.08 2.63 0.2 3000 -0.04 Note: The list excludes the same funds with different classes, and institutional funds have been excluded. Funds having minimum initial investment above $5000 have been excluded. Q3 % Rank vs. Objective* equals the percentage the fund falls among its peers. Here, 1 being the best and 99 being the worst. The top half of this list of 15 best-performing no load mutual funds is dominated by funds that employ the short-selling or inverse strategy. Top performer, Rydex Inverse Emerging Markets 2X Strategy Fund A, seeks a return that is 200% of the inverse daily performance of the BNY Mellon Emerging Markets 50 ADR Index. RYWYX, however, now carries a Zacks Mutual Fund Rank #4 (Sell) . Similarly, the next four funds in the list, Rydex Inverse Russell 2000 2x Strat H, Rydex Inverse Russell 2000 Strat H, and Rydex Inverse Dow 2X H, Rydex Inverse S&P 500 2x Str H seek inverse returns. Funds from the Government Bond category also had a decent representation in this list of best gainers. Remember, this category was the second-best gainer among fund categories in the third quarter, according to Morningstar data. Rydex Government Long Bond 1.2x Strategy Fund Inv (MUTF: RYGBX ), Fidelity Spartan Long Term Trust Bond Index Fund Inv (MUTF: FLBIX ) and Vanguard Long Term Treasury Fund Inv (MUTF: VUSTX ) posted gains of 6.8%, 5.5% and 5.4%, respectively. Each of these three funds carries a Zacks Mutual Fund Rank #1 (Strong Buy) . Separately, ATAC Inflation Rotation Fund Inv (MUTF: ATACX ) and GAMCO Mathers Fund No Load (MUTF: MATRX ), which posted respective gains of 7.3% and 6.1%, carry a Zacks Mutual Fund Rank #3 (Hold) each. The best-performing RYWYX’s gain of over 43% was substantially higher than the second-quarter top scorer Matthews China Dividend Fund Inv ‘s (MUTF: MCDFX ) gain of 14.7%. However, while we have nine funds this time with sub 10% total return, only six had ended below 10% in the second quarter’s top performer list. Also, the lowest gain in the third quarter list of 5.4% compares unfavorably with the second quarter’s 15th-ranked Emerald Banking and Finance Fund Inv ‘s (MUTF: FFBFX ) gain of 8.2%. Original Post Scalper1 News
Scalper1 News