During the month of May, TSC Ratings added 18 stock funds to its universe of over 11,000 rated stock funds.
Of the funds that carry a TSC Rating of B or higher, there are three funds that stand out and provide opportunity in the near term -- the
ING Marisco International Opportunities Portfolio
ING MFS Utilities Portfolio Fund
Julius Baer International Equity Fund II
IMISX invests in foreign stocks in countries like Switzerland (16.99%), France (10.86%), the U.K. (10.64%) and Brazil (7.35%). It allocates approximately 12.77% of assets to the U.S. market. It's quite broad sector-wise, covering the telecommunications, financial services, food, building materials, oil and gas and banking. For those wanting geographical and sector diversification this fund provides both.
IMUSX's focus is in the utilities sector predominantly investing in debt securities of electric (43.74%) and telecommunications (29.30%) companies as well as those oil and gas (14%). It invests mainly in the U.S. (60.72%) and has small allocations of 5% or so in each of the following Spain, Canada, France and the U.K.
Some of the companies in its portfolio include
Williams Coal Seam Gas Royalty Trust
El Paso Corp.
American Electric Power
JETAX is invested in equity securities in international markets and may allocate 35% to emerging markets at any point in time. It is predominantly exposed to France (10.89%), U.K. (9.46%), Germany (8.35%), Japan (6.76%) and Russia (5.92%). JETAX's sector allocations favor banking (20.5%), with lesser exposure to oil and gas (9.52%), telecommunications (8.33%), mining (7.46%), engineering and construction (5.12%) and electric (4.68%).
JETAX's exposure to the international banking sector is of concern, should banking problems take root overseas as they have done in the U.S., remembering that the property bubble is a global event. One would hope that the mortgage underwriting standards overseas were not as lax as they were in the U.S.
Nonetheless, the bigger issue is the specter of a global slowdown and its possible effect in increasing bad debts on the balance sheets of banks worldwide.
Sam Patel, CFA, is the manager of mutual fund research for the TheStreet.com Ratings.
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