- U.S. equities all fell in the shortened trading week because of Labor Day.
- The best-performing fund so far for 2017 continues to be the Neuberger Berman Greater China Eq Instl (NCEIX).
- Latin America Equities is the best-performing mutual fund subcategory based on the rolling month.
- Make sure to check out the previous edition of the Weekly Roundup to keep track of changing trends in the mutual funds space.
Market Wrap-Up
The energy sector was this week’s top-performing area, up 2.27%. The sector is composed of companies like Exxon Mobil Corp. (NYSE: XOM) and Chevron Corp. (NYSE: CVX) that were up 3.50% and 3.46%, respectively, during the week.
Explore our Mutual Fund Education section to learn more about important mutual fund concepts.
International Equities – International markets mostly showed positive movements with the exception of the Nikkei. The MSCI Developed Index increased 0.83% to close at 1,954. The MSCI Emerging Index had a slight increase of 0.04% for the week and remains the best-performing index on a year-to-date basis, up 29.11%. Japan’s Nikkei 225 returned to the negative, down 1.89% to close at 19,275.
Commodities – The commodity sector saw gains except for copper. Crude oil finally saw gains of $0.25 per barrel and closed at $47.48 per barrel. The price of gold increased $30 per troy ounce to close at $1,346. Copper was down for the week, decreasing by $0.06 to close at $3.04.
Be sure to read our important tips on how to invest in the right commodity-based mutual fund.
Taxable Bonds – Treasury yields saw big declines this week. The 2-year Treasury dropped 8 bps to yield 1.26%. The 10-year Treasury yield dropped 12 bps while the 30-year Treasury yield dropped 11 bps to 2.67%.
Municipal Bonds – Municipal yields also fell across all maturities this week. The 2-year AAA-rated bonds decreased 1 bps to yield 0.84%. The 10-year AAA-rated bonds declined 6 bps, while the 30-year AAA-rated bond dropped 4 bps and still yields 2.71%. Municipal bond funds saw inflows of $248 million for the second week in a row. The largest credit spread for the five-year securities declined by 8 bps to settle at 53 bps for this week.
Performance Snapshot: Top Fund Category
| Category | Top Subcategory | MTD Subcategory Return (%) | Top Subcategory Performer | Top Subcategory Performer | MTD Fund Return (%) | Performance Rationale |
|---|---|---|---|---|---|---|
| U.S. Equity Fund | Large Cap Growth | 0.44% | Kinetics Internet No Load | WWWFX | 3.27% | The fund has over 17% in technology, which is the number one performing sector this year. |
| International Equity | Latin America Equities | 8.17% | Deutsche Latin America Equity S | SLAFX | 10.10% | The fund invests in Latin American companies, like its largest holding, Raia Drogasil SA (BVMF:RADL3) that is up over 21% YTD. |
| Commodities | Broad Basket | 1.30% | Invesco Balanced-Risk Commodity Strat R6 | IBRFX | 3.50% | WIth oil declining, the fund was protected by being invested in over 42% cash and 32% Treasuries. |
| Taxable Bonds | Government Bonds | 3.58% | Vanguard Extended Duration Trs Idx InsPl | VEDIX | 5.05% | The fund invests in longer term bonds, which gained the most after Treasury yields saw a significant decline this week. |
| Municipal Bonds | High Yield Muni | 1.10% | AB Municipal Income | MISHX | 1.74% | With muni bonds yields decreasing, high yield bonds saw the largest gain in price. |
Performance Snapshot: Top Fund
The fund’s largest holding is in Tencent Holdings Ltd (HKG:0700), which is up over 75% on a year-to-date basis.
Top 5 Performers
The following table provides the top-performing mutual funds on a YTD basis as of September 8, 2017. Only those funds that are rated five stars by Morningstar and that generated YTD returns greater than or equal to that achieved by the S&P 500 are included.
| Name | Ticker | Category | YTD % | Net Expense Ratio | % of Assets in Top 10 Holdings | Total Assets $ (Millions) | Top Sector Invested |
|---|---|---|---|---|---|---|---|
| Neuberger Berman Greater China Eq Instl | NCEIX | China Equities | 47.03% | 1.76% | 51.8% | $ 131 | Financial Services |
| Morgan Stanley Inst International Opp IS | MNOPX | Foreign Large Cap Growth Equities | 44.81% | 5.64% | 46.6% | $ 329 | Technology |
| Wasatch Emerging India Institutional | WIINX | India Equities | 41.53% | 2.00% | 35.3% | $ 232 | Financial Services |
| Morgan Stanley Inst Global Opp IS | MGTSX | Global Equities | 39.20% | 3.82% | 57.6% | $ 1,420 | Technology |
| Matthews China Small Companies | MCSMX | China Equities | 39.10% | 2.24% | 35.7% | $ 24 | Industrials |