This Day On The Street
Continue to site
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

Take Your Funds' April 14 Performance as a Sign of Future Risk

Now you see it. Now you don't.

In today's market time, where 10 minutes seem to bring what 10 years used to, last week's rout is likely little more than a distant memory.

Don't forget so soon. Believe it or not, that red-flashing ticker handed you more than a scare and a stomachache. Not only did it offer a valuable (if unwelcome) reminder that there are no guarantees on Wall Street, the selloff also gives a black-and-white (or green-and-red) picture of an investment's potential future risk.

Oh yes, we could rely on the often incomprehensible -- and almost always imperfect -- measures like beta and alpha to try to figure that out. But let's be honest: When was the last time you looked at those numbers before buying?

A far better way of getting a sense of your investment's riskiness is an answer to this question: How does it perform in a correction, or even a crash? What happens when the markets go down, not up?

It's been a while since we could ask that question. You have to go back to the last quarter of 1998. And times may be different now. Then, the bull just took a breather, and within two months, was running full-speed ahead. And that was with the help of the Fed slicing interest rates. Few expect Alan Greenspan & Co. to be so accommodating today.

But if you want to predict the pulse of your fund or stock during down times, you may have trouble. Don't expect your fund firm to trumpet how it performed during April's storm. And the major rating companies generally offer results measured in round quarters or years.

So here's a list worth keeping -- from the market high of March 10 through last Friday's free fall, these are the best among the biggies -- that is, among the funds you likely hold.



Best of the Bigs
Large funds that fared the best between March 10 and last Friday.
Fund March 10- April 14 Return April 14 Return 1-Year Return
(AWSHX) Washington Mutual Investors 8.7% -4.7% -6.2
(AIVSX) Investment Co. of America -0.1 -4.4 6.2
(FGRIX) Fidelity Growth & Income -2 -5.3 -2.7
(VFINX) Vanguard 500 Index -2.7 -5.8 3.4
(FMAGX) Fidelity Magellan -6.5 -5.9 4.1
(FCNTX) Fidelity Contrafund -11.3 -5.3 -1.6
(TWCUX) American Century Ultra Inv -11.8 -7.3 -1.5
(JANSX) Janus -12.8 -5.8 16.3
(AGTHX) Growth Fund of America -13.5 -5.9 34.5
(JAVLX) Janus Twenty -18.0 -5.8 12.6
Source: Morningstar




A couple of things to note: When you're looking at past returns, 1999 is ancient history. Much more revealing are trailing one-year returns, which tell you a whole lot more because they include both faces of this Jekyll and Hyde market. Check out how the market mayhem ate away at your gains. I did a double-take when I saw (JAVLX) Janus Twenty's one-year number -- a meager 12.6%, compared with 1999 calendar-year returns of nearly 65%. Same goes for (JANSX) Janus fund -- one-year trailing returns of 16% compared with 1999's 47%. Both of these aggressive, tech-taut funds fell quite a bit when compared with their peers. Janus Twenty went from the top 10% of large growth funds in 1999 to the bottom half of the category for the past 12 months.

See these previous stories for lists of the best-performing and worst-performing diversified funds during this period. I asked Morningstar to run a slightly longer list. What's fascinating about the best performers is that some familiar names whose obituaries had pretty much been written by the momentum guys are very much alive and kicking. Among the top 25 performers: (CLPRX) UAM Clipper Focus , which gained 14% during the last few weeks, a big improvement over its 4% loss over the past 12 months and (OAKMX) Oakmark , which recently lost Bob Sanborn as longtime manager because of his adherence to a strict value philosophy, was back among the living too -- gaining 14% vs. a 22% loss over the last year.

Bottom line: You've now got a good barometer, one you should remember as you buy or sell funds, whether we end up riding the bull again or trying to hide from the bear.

Brenda Buttner's column, Under the Hood, appears Thursdays. At time of publication, Buttner held no positions in any securities mentioned in this column, although holdings can change at any time. Under no circumstances does the information in this column represent a recommendation to buy or sell stocks or funds. While she cannot provide investment advice or recommendations, Buttner appreciates your feedback at TSCBrenda@aol.com.

Check Out Our Best Services for Investors

Action Alerts PLUS

Portfolio Manager Jim Cramer and Director of Research Jack Mohr reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

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
Stocks Under $10

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

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
14-Days Free
Only $9.95
14-Days Free
Dividend Stock Advisor

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
  • Updates with exact steps to take - BUY, HOLD, SELL
Trifecta Stocks

Every recommendation goes through 3 layers of intense scrutiny—quantitative, fundamental and technical analysis—to maximize profit potential and minimize risk.

Product Features:
  • Model Portfolio
  • Intra Day Trade alerts
  • Access to Quant Ratings
Options Profits

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

Product Features:
  • Actionable options commentary and news
  • Real-time trading community
SYM TRADE IT LAST %CHG
AAPL $129.96 -0.44%
FB $80.44 0.19%
GOOG $539.18 0.97%
TSLA $248.35 -0.44%
YHOO $43.15 -0.46%

Markets

DOW 18,011.94 -28.43 -0.16%
S&P 500 2,109.60 -2.13 -0.10%
NASDAQ 5,076.5240 -6.4050 -0.13%

Partners Compare Online Brokers

Free Reports

Top Rated Stocks Top Rated Funds Top Rated ETFs