Dateline: 7/20/98

June produced 38 Power Performer Funds, down from 42 in May. The strength in one month performance has shifted from the European funds to American Equity funds and some Telecommunications funds. This is the end of the first half of 1998 so once again it's time for our six months review.

Power Performers Six Months Review!

Sixty-two mutual funds made the Power Performers list at least once in the first half of 1998. About half (29) were U.S. Equity funds. Seventeen Canadian Equity funds made the list as did nine International Equity funds. Rounding out the list are five Dividend funds, one Balanced fund and one Sectoral fund. (Two if you count AIC Advantage as a Sectoral fund. I've included it with Canadian Equity.)

For a complete listing of the Power Performers for the last six months, check out my Six Month Report. It shows the the complete roster of 62 funds indicating the percentage gain or loss for each month the fund was a Power Performer or an "X" if it was not a Power Performer that month. Also included is a summary of each fund's performance for the six months as a whole.

Of the 62 funds, only thirteen were Power Performers every single month. This is up one from twelve for the last half of 1997. An additional fourteen funds were Power Performers five months out of the six. I'd like to say that these 27 funds are our All Star Performers, but ironically, the BPI American Small Companies Fund, which made the list five out of six times, actually lost money for the six months, declining 0.8%. With this exception, the rest are All Star Performers, though you should be wary of any that have been declining in the last two months.

The year started slowly with only nineteen Power Performers in January. The number grew to 52 in April. The International funds showed the biggest gains, jumping from one fund in January to seven in May. Canadian Equity funds ended the period on a weak note, with only two Canadian Equity funds making the grade in June.

The best overall performers for the six months were the European funds which gained anywhere from 23.4% to 40.2% (Dynamic Europe). Hot up there with the Europeans were a few American Equity funds, notably Ethical North American Equity Fund (up 33.9%), AGF American Growth Fund (up 33.6%), MD U.S. Equity Fund (up 32.9%), Metlife MVP U.S. Equity Fund (up 26.6%), BPI American Equity Value Fund (up 26.1%) and Spectrum United American Growth Fund (up 24.2%). The best performing Canadian Equity funds for the six months were the Quebec Growth Fund which was up 20.5% though only making the Power Performers list once. The next best was AIC Advantage, which made the list every month and gained 18.7% for the period.

Of the thirteen funds that made the PP list every month, five made gains every month. These were AIC Value, Ethical North American Equity, Investors U.S. Growth, MD U.S. Equity, and Fidelity European Growth. These funds gained anywhere from 19.4% to 33.9% for the six month period.

And eight of those thirteen funds also made it every month in the last half of 1997. In other words, eight funds have been Power Performers every month for a year now. They are AIC Advantage, AIC Value, Chou Associates, Ethical North American Equity, Fidelity Growth America, Investors U.S. Growth, PH&N U.S. Pooled Pension, and Spectrum United American Growth. The overall top performer of these eight funds is the Ethical North American Equity Fund, my pick for top fund for the last year and my pick for the best fund to invest in right now.

All in all, it was an exciting six months for investors, with solid gains in a good two dozen funds. Now on to our portfolio review.

Portfolio Review

All of our three portfolios all gained significantly this past month. The largest jump was Portfolio # 3 which gained over $3000. Since all are fully invested and none had funds that dropped 5% during the month, we are holding all our positions. The charts show the name of the investment, the number of shares and the current price.

Portfolio # 1 (Buy Strategy - Fund must be in the Top 25 Performers for a Three Month period and the One Month performance should not be negative nor excessive compared to the Three Month. Sell on 5% slide.)

Portfolio Value at 7/17/98: $ 31,087.46 - up 24.3% since inception (12/22/97)

Portfolio # 2 (Buy Strategy - Same as Portfolio # 1 plus the fund must have a better than 15% performance for the One Year, Three Year and Five Year periods. Sell at 5% slide)

Portfolio Value at 7/17/98: $ 29490.09 - up 18.0% since inception (12/22/97)

Portfolio # 3 (Buy Strategy - Fund must be a Power Performer and it must have positive Three Month and One Month figures. Sell on 5% slide.)

Portfolio Value at 7/17/98: $ 31915.73 - up 27.7% since inception (12/22/97)

Controls: (2 Funds purchased to buy and hold as benchmarks for our portfolios.)

The three portfolios can be characterized as aggressive, conservatively aggressive and conservative. Conservative Portfolio # 3 surged ahead to lead the pack this month. Aggressive Portfolio # 1 slipped back to second spot and the benchmark AIC Advantage 2 is in third. Portfolio # 2 follows that and conservative benchmark Trimark Fund brings up the rear. Here is a chart of the standings.

Note that Portfolio # 3, based on my Power Performers, has now taken the lead. This portfolio was largely in cash for the initial two months as not enough funds filled the buy criteria, so it lagged behind the others. Once fully invested, it has outperformed the others.

Links to Sites Mentioned This Week

Power Performers Six Month Review to June 30, 1998

Marco's Power Performers to June 30, 1998

Top 25 Three Month Performers to June 30, 1998

Funds Performing Better Than 15% Annual Compounded Rate Over 15 Years

Funds Performing Better Than 15% Annual Compounded Rate Over 10 Years

Marco's Power Performers Index Page

Disclaimer: As with all my columns here, I should re-iterate a precaution. I am not a professional financial advisor. I am a financial journalist and editorialist. The views in these columns are my personal opinions. The author holds interests in a number of the funds mentioned in this article.

American Readers: Looking for a broker who can sell you Canadian stocks? One of my brokers is licensed to sell securities to Americans in 26 states. She works for Canaccord Capital which is an excellent company with a superb research department. They are particularly knowledgeable on resource issues. Send me a note if you want to get in touch with her.

Investing (Canada) Notes:

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