In a month when stocks fell enough to qualify as a bad full year, a handful of equity mutual funds made headway against the torrent of selling, half of them foreign-focused.
Now, investors have to decide if the gains, during a month when the benchmark
tumbled more than 10%, were harbingers of incipient reversals or dead-cat bounces after drops from lofty peaks.
The 10 stock funds populating the adjoining table represent February's best stock-fund performers, excluding the ubiquitous leveraged and "inverse" participants that routinely cluster at both extremities of the performance array.
The foreign-focused entries may have simply enjoyed rebounds after brutal falls. Even after their one-month gains, the three Russian funds, the China play and the international small-cap portfolio remain below water by as much as 81% for the most recent 12 months.
The two Russian funds with sufficient histories for evaluation from
Ratings -- the
ING Russia Fund
World Funds Third Millennium Russia Fund
-- receive the lowest possible grade of E-minus from
Ratings, classifying them as "sell" recommendations. The
Oppenheimer International Small Company Fund
is also an E-minus, while the
Oberweis China Opportunities Fund
rates a D-plus, also equivalent to a "sell" recommendation.
Tocqueville Gold Fund
has international holdings in its precious metals portfolio. Along with the
Fidelity Select Telecom Portfolio
, the funds are graded by
Ratings in the "C" range, making them "hold" recommendations.
The only member of the group with positive results for the latest 12 months is a hedge-fund lookalike, the
Virtus Market Neutral Fund
, which has eked by with a gain of 0.10% for the period. Its steady performance in the face of recent market turbulence earns it the highest possible grade of A-plus, equivalent to a "buy" recommendation, from
A fund with performance somewhat resembling a hedge fund, the
Z-Seven Fund Inc.
, remains fractionally higher for the past three years. It's the only fund on the list not in the minus column for that period (with the exception of the
J.P. Morgan Russia Fund
, for which a three-year return was not available).
Another steady performer that gained in February was the
Hussman Strategic Growth Fund
, which ended within a fraction of breakeven for the past three years. Its grade of "A" from
Ratings equates with a "buy" recommendation.
Richard Widows is a senior financial analyst for TheStreet.com Ratings. Prior to joining TheStreet.com, Widows was senior product manager for quantitative analytics at Thomson Financial. After receiving an M.B.A. from Santa Clara University in California, his career included development of investment information systems at data firms, including the Lipper division of Reuters. His international experience includes assignments in the U.K. and East Asia.