This Day On The Street
Continue to site right-arrow
ADVERTISEMENT
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
Stocks Under $10 with 50-100% upside potential - 14 days FREE!

10 Stocks of Top-Performing Mutual Funds in 2012

Stocks in this article: MNST EBAY CAB AVD REGN ACAT SHLD AIG PII ALXN

BOSTON ( TheStreet) -- It's been a miserable past few years for actively managed mutual funds as investors have been stampeding out of them to seek low-risk alternatives to stocks, such as bond funds.

But there are a few U.S. equity funds that are earning their keep with returns more than double that of the S&P 500's 6.8% gain this year, which should convince some investors that it's worth keeping a toe in the stock market.

As for the funds, investors have taken more than $172 billion out of actively managed U.S. and international funds over the past 12 months, and U.S stock funds saw their 13th consecutive month of outflows in May, fund tracker Morningstar said Friday.

A good bit of that money could come back into stocks once there is a clear resoultion to Europe's sovereign debt woes, which will give a tremendous boost to the market.

But for now, it appears investors can't stomach the market volatility especially after getting burned in the 2008 market swan dive and the prospects for an economic meltdown in Europe.

Nevertheless, some wily fund managers are more than earning their keep in the current, hostile environment for stocks.

For example, the $7 billion Fairholme (FAIRX) fund, run by the highly respected Bruce Berkowitz since 2000, is back as a top performer after a tough run last year when it plunged 32%, with an 18.7% return so far in 2012. His "put all your eggs in one basket" approach is not for everyone, but when he's on a winning streak, Berkowitz is hard to beat. This year, his fund is in the top 1% of funds in the large-value fund category in terms of performance.

Berkowitz's risky bet on the property-casualty insurer and financial-services giant American International Group (AIG) (the fund owns 4.4% of its shares versus 0.3% for the next largest shareholder) a few years ago, is paying off big time with a 30% gain, after a 52% plunge in its share price last year. AIG makes up about 30% of the Fairholme portfolio and is its biggest holding.

And Fairholme has also done well on another decidedly out-of-favor stock, the struggling retailer Sears Holdings (SHLD). Its shares are up 59% this year despite its recent dismal financial performance and concerns about its survivability in a tough retail environment. The fund owns 13% of Sears's outstanding shares, with the next largest investor at a mere 1%.

SunAmerica Focused Growth (SSAAX) fund, with $133 million in assets, is up 17% this year to put in the top 1% of its large-growth category peers. Managed by Ron Sachs since 2008, it has the ever-popular iPhone and iPad maker Apple (AAPL) as its top pick at just over 9% of the fund (Apple is up 41% this year), followed by online auction site eBay (EBAY), up 32% this year.

But SunAmerica's biggest winner is soda maker Monster Beverage (MNST), up 62%.

Also on the best-performers list is the $2 billion Touchstone Sands Capital Institutional Growth (CISGX), which has been run by Frank Sands Jr. for the past seven years. It's up 12.4% this year, putting it in the top 2% of the large-growth fund category. It has benefited from its 8.7% Apple stake, but also from investments in biopharmaceutical firms.

They include Regeneron Pharmaceuticals (REGN), which is up 102% this year and makes up 3.3% of the portfolio, and Alexion Pharmaceuticals (ALXN), up 30% this year, at 4% of the portfolio.

The $118 million Matthew 25 (MXXVX) fund, run by Mark Mulholland for almost 16 years, is up 14.6% this year, also putting in the top 1% of the large-growth category of funds. It, too, has Apple as its top pick, but among its other big winners are the sporting goods retailer Cabela's (CAB), up 32% this year and the fund's third-largest holding at 7% of the portfolio.

Matthew 25 also has gotten a boost from another outdoor enthusiasts' products maker, snowmobile and all-terrain vehicle manufacturer Polaris Industries (Pii), which has gained 24% this year.

Also leading the league is the $224 million, small-cap growth fund Hennessey Cornerstone Growth (HFCGX) run by Neil Hennessey since 2000. It's up 15.2% this year, putting it among the top 1% of performers among its peers thanks to the success of its stake in the specialty chemicals maker American Vanguard Corp. (AVD) and yet another snowmobile manufacturer, Arctic Cat (ACAT).

Here are 10 stocks held by five top-performing actively managed stock mutual funds, in inverse order of share-price return this year:

1 of 3

Select the service that is right for you!

COMPARE ALL SERVICES
Action Alerts PLUS
Try it NOW

Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
  • Weekly roundups
TheStreet Quant Ratings
Try it NOW
Only $49.95/yr

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
  • Upgrade/downgrade alerts
Stocks Under $10
Try it NOW

David Peltier, uncovers low dollar stocks with extraordinary upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
  • Weekly roundups
Dividend Stock Advisor
Try it NOW

Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Alerts when market news affect the portfolio
  • Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
Real Money Pro
Try it NOW

All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.

Product Features:
  • Real Money + Doug Kass Plus 15 more Wall Street Pros
  • Intraday commentary & news
  • Ultra-actionable trading ideas
Options Profits
Try it NOW

Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • 100+ monthly options trading ideas
  • Actionable options commentary & news
  • Real-time trading community
  • Options TV
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!

Markets

DOW 17,778.15 +421.28 2.43%
S&P 500 2,061.23 +48.34 2.40%
NASDAQ 4,748.3960 +104.0840 2.24%

Brokerage Partners

Rates from Bankrate.com

  • Mortgage
  • Credit Cards
  • Auto

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs