| Bond Funds Lead the Way in July | |
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Monthly Mutuals Analysis
Dateline:
Aug. 16, 2001
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It's been a while since bond funds were the market leaders. But for July, fully ten of the Top 25 funds as reported at The Vancouver Sun's Top Funds page were these staid stalwarts. Another five were specialty funds and five more were - can you believe it - tech funds. Mind you, every one of the tech funds was in the medical and biotech field.
But let's look a bit more closely at the breakdown of the Top 25. Every one of the bond funds was a foreign bond fund, not Canadian or U.S. one. Bond funds usually do well in an environment of falling long term interest rates.
The specialty funds are the more interesting ones to look at, especiallly since four were in the top ten. These are hedge funds that are designed to go contrary to the general market. When markets fall, hedge funds go up. During market bulls, they hold their own or decline. Their purpose is to balance out your portfolio to ride out market downturns. But they often require huge minimum investments. The Hillsdale Canadian Aggressive Hedged Fund and the Quantum Aggressive Market Neutral Fund both require a minimum investment of $150,000. That's out of reach for 99% of all investors.
But three of the hedge funds making the Top 25 for July are available to the average investor. The Friedberg funds require only a $2000 investment. And the @rgentum Canadian Long/Short Equity Portfolio Fund requires a minimum investment of just $500. The fund holds about 60% of its portfolio in long positions and 40% in short positions. @rgentum's website has an interesting article on its fund (and hedge funds in general) by the Globe's Rob Carrick. Be sure to give it a read.
The three month performance rankings don't yet show bond funds in the limelight, dominated instead by small caps and hedge funds.
Here are the Top Ten Funds in June:
| Rank | Fund | Type | 1 Month | 3 Month | 1 Year |
|---|---|---|---|---|---|
| 1 | StrategicNova World Strat Asset Allocation RSP | Balanced | 12.52% | 6.52% | -2.87% |
| 2 | Friedberg Diversified Fund | Specialty | 11.72% | 19.72% | 57.91% |
| 3 | @rgentum Canadian L/S Equity Portfolio | Specialty | 10.19% | 4.09% | 18.46% |
| 4 | StrategicNova U.S. Midcap Value RSP Fund | US Equity | 8.58% | 6.54% | -5.69% |
| 5 | Friedberg Futures Fund | Specialty | 7.10% | 10.65% | 37.15% |
| 6 | First Trust Pharmaceutical Trust 1999 Series C$ | Technology | 5.25% | 9.28% | 23.89% |
| 7 | Hillsdale Canadian Aggressive Hedged | Specialty | 4.99% | 10.39% | 16.30% |
| 8 | First Trust Pharmaceutical Trust 1997 Series C$ | Technology | 4.51% | 0.26% | 6.67% |
| 9 | Mac Industrial Growth Segregated Fund | Cdn. Equity | 4.51% | 11.78% | 24.35% |
| 10 | Trans IMS International Bond Index | Bond | 4.44% | 1.18% | 6.22% |
Power Performers
| Definitions |
| Power
Performers Funds returning better than 20% for each of the 1 year, 3 year and 5 year periods. |
Super Power
Performers |
For the second month running there are no Power Performers. Not one. Not a single stock returning better than 20% per year for 1 year, 3 year and 5 year growth. But the Resolute Growth Fund is very, very close.
The number of our Strong Performers remains at 8.
The rebound in health related funds is an interesting indication of an emerging trend. Pat McKeough, editor of The Successful Investor, among others, believes this will be the next big wave. Recently Biovail cracked our New Highs as reported in our weekly Break Out Report. We're keeping an eye out to see if a definite trend emerges.
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