There are almost 50 funds> and share classes holding a whopping $1.1 trillion that are up more than the S&P 500 index s 23% return in 2009. Needless to say, it s been a good year for some of the industry s largest players. And that means it s also been a decent 11 months for millions of investors, too, who own those funds in their retirement accounts.
But the mutual-fund world s billion-dollar behemoths aren t the only offerings posting good numbers this year. Some of the industry s tiniest funds are soaring. Croft Value (CLVFX)
This week we are concentrating on the industry s small fry. You may be surprised to find out these funds actually constitute a majority of the offerings on the market. Indeed, of the 21,551 funds and share classes in our database, just over 17,000 hold less than $250 million each. We knocked out of contention the ones that charged a sales load and high annual fees. That left us with a list of 50 funds and from those we selected 12 that were actively run and featured decent long- and short-term track records. They are listed on the table below.
There are both pros and cons to investing in these funds. Costs can be an issue. Big fund families like Fidelity or Vanguard can spread costs across their entire lineup. A one-fund shop doesn t have that luxury. In addition, the forced selling and buying that comes with cash inflows and outflows could potentially have a more profound impact on a small asset base.
That said, one appealing aspect of small funds is that in many cases the manager s name is on the door. They're in for the long haul and usually have their own personal wealth in their fund right next to shareholders. These funds can also be a vehicle for a manager who has left a big fund family and struck out on his own. That was the case with David Winter s Wintergreen fund (WGRNX)
The criteria: The funds on our table hold less than $250 million each. They are open to new money, require a minimum investment under $5,000 and charge an annual expense ratio less than 1.5%. In addition, they had performance track records during the trailing three- and five-year time periods that put them in the top 25% of their peer groups. They're also up more than the S&P 500 for 2009. As usual, we did not include load funds.
Note: Data as of Nov. 12, 2009
|Becker Value Equity||BVEFX||82.0||24.35||3.66||0.99|
|Homestead Small Company Stock||HSCSX||58.5||37.85||3.93||1.25|
|Matthews Asia Pacific||MPACX||208.6||41.97||8.32||1.23|
|Nicholas Equity Income||NSEIX||47.9||28.69||5.12||0.90|
|Old Mutual Focused||OBFVX||68.5||29.16||3.37||1.12|
|PRIMECAP Odyssey Stock||POSKX||179.5||31.19||4.11||0.79|
Fund Type = *
Annualized 3-Year Return (%) = Display Only
Rank in Classification (%) (3 year performance) <= 25
Annualized 5-Year Return (%) = Display Only
Rank in Classification (%) (5 year performance) <= 25
Expense Ratio <= 1.5%
Load Fund (type) = No Load
Minimum Initial Investment <= $5,000
Open to New Investors = Yes
Total Net Assets ($ millions) <= 250
Year-to-Date Return (%) >= 23
*Screen does not include fixed income funds