Fund shops rolled out a couple of new funds in sectors that have stayed afloat this year.
rolled out the broker-sold
fund and on Monday
launched the broker-sold
Federated Market Opportunity
fund, an all-cap value fund. It's not much of a surprise that the funds focus on biotech stocks and value or seemingly undervalued stocks, respectively. In a year when most stocks and funds are far underwater, the
American Stock Exchange Biotechnology Index
is up more than 47% since Jan. 1 according to
and the average value fund is also in the black, according to
The Munder fund will primarily invest in stocks of biotech companies, which are cutting-edge drug shops, and the tech firms that contribute to their research -- hence the numeral "2," for "twice the technology" according to the company's statement. A team of managers from Munder and its London-based affiliate
will hold the reins. Antony Milford, manager of the biotech-heavy
Munder Framlington Healthcare fund since its 1997 inception, will be on the team. That fund is up some 117% percent over the last 12 months and beats more than 80% of its peers over the last three years, according to Morningstar.
The Federated fund will typically hold 75 or 80 stocks that manager Steven Lehman believes are attractively priced -- value funds are essentially bargain hunters. In addition to seeking capital appreciation, he's also going to try to pay out a steady stream of dividend income. In taking over this fund, Lehman will leave his post at the helm of the broker-sold
Federated Utility fund and be replaced by John Nichol. Lehman worked on the Utility fund for the last three years and the fund's 2.3% annualized return over that time period trails some 97% of the fund's peers, according to Morningstar.
Neither new fund will come cheap. The Munder fund's Class A shares levy a maximum 5.5% front-end load or sales charge, while its Class B and Class C shares carry a maximum 5% and 1% back-end load, respectively. The fund's annual expense ratio is 2% on Class A shares and 2.75% on Class B and Class C shares. All are higher than the average health care fund's 1.71% expense ratio, according to Morningstar.
The Federated funds' Class A shares carries a maximum 5.5% front-end load and its Class B and Class C shares levy a maximum 5.5% and 1% back-end load, respectively. The fund's annual expenses will be 1.2% on Class A shares and 1.95% on Class B and Class C shares. The average value fund's expense ratio is 1.46%.