TSC Ratings provides exclusive stock, ETF and mutual fund ratings and commentary based on award-winning, proprietary tools. Its "safety first" approach to investing aims to reduce risk while seeking solid outperformance on a total return basis.
Nine of the 10 best-rated stock mutual funds
are making a repeat appearance.
To put that in perspective, TheStreet.com Ratings assesses 12,595 open-end equity mutual funds, of which 3,194 are ranked "buy."
TheStreet.com Ratings' equity-fund model punishes volatility. So market-neutral funds, which use long and short positions to level market movements, prospered again.
All funds in the table below earned the highest rating of A-plus for the period ending May 31. Each has at least 50% exposure to equities.
The best-rated stock mutual fund is still the
JPMorgan Market Neutral Fund
, which improved its averaged annual return over three years to 5.8%. Overvalued mid- and large-capitalization stocks are sold short to counter-balance undervalued shares from the same sector held in the portfolio.
The largest long positions intended to build to net asset value as they rise include
News Corp. Class A
The biggest short positions of the JPMorgan Market Neutral Fund are
News Corp. Class B
Johnson & Johnson
The new member of the top 10 stock mutual funds this month is the
Aston Montag & Caldwell Balanced Fund
, which jumped 16% in the three months ending May 31. Over this period, key holdings experienced gains of 97% in
Research in Motion
, 52% in
, 22% in
, 41% in
and 20% in
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Kevin Baker became the senior financial analyst for TSC Ratings upon the August 2006 acquisition of Weiss Ratings by TheStreet.com, covering mutual funds. He joined the Weiss Group in 1997 as a banking and brokerage analyst. In 1999, he created the Weiss Group's first ratings to gauge the level of risk in U.S. equities. Baker received a B.S. degree in management from Rensselaer Polytechnic Institute and an M.B.A. with a finance specialization from Nova Southeastern University.