- U.S. and international equities all saw large gains this week, with the Dow Jones Industrial Average hitting an all-time high.
- 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.
The telecom sector was this week’s top-performing area, up 3.89%. The sector is composed of companies like AT&T Inc. (NYSE: T) and Verizon Communications Inc. (NYSE: VZ), which were up 5.14% and 3.89%, respectively, during the week.
Explore our Mutual Fund Education section to learn more about important mutual fund concepts.
International Equities – International markets also saw positive gains with the MSCI Developed Index increasing 0.56% to close at 1,964. The MSCI Emerging Index had a gain of 1.06% for the week and remains the best-performing index on a year-to-date basis, up 30.48%. Japan’s Nikkei 225 bounced back from last week’s decline, gaining 3.29% to close at 19,910.
Commodities – The commodity sector saw declines except for oil. Crude oil saw gains for the second week in a row, up $2.41 per barrel and closing at $49.89 per barrel. The price of gold decreased $26 per troy ounce to close at $1,320. Copper was also down for the week, decreasing by $0.09 to close at $2.95.
Be sure to read our important tips on how to invest in the right commodity-based mutual fund.
Taxable Bonds – Treasury yields saw big increases this week. The 2-year Treasury increased 12 bps to yield 1.38%. The 10-year Treasury yield gained 15 bps, while the 30-year Treasury yield moved up 10 bps to 2.77%.
Municipal Bonds – Municipal yields also gained across all maturities this week. The 2-year AAA-rated bonds increased 3 bps to yield 0.87%. The 10-year AAA-rated bonds increased 9 bps, while the 30-year AAA-rated bond gained 8 bps and yields 2.79%. Municipal bond funds saw inflows of $313 million for the third week in a row. The largest credit spread for the five-year securities increased by 9 bps to settle at 62 bps for the 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||Small Growth||3.21%||Baron Discovery Retail||BDFFX||7.01%||The fund’s top holding is MACOM Technology Solutions Holdings Inc (NASDAQ:MTSI), which is up over 8.7% for the month.|
|International Equity||Latin America Equities||11.14%||Deutsche Latin America Equity S||SLAFX||12.52%||The fund invests in Latin American companies. For instance, its largest holding, Raia Drogasil SA (BVMF:RADL3), is up over 25% YTD.|
|Commodities||Broad Basket||3.62%||PIMCO CommoditiesPLUS® Strategy Instl||PCLIX||5.95%||The fund benefited by remaining almost 55% invested in energy-based commodities.|
|Taxable Bonds||Emerging Markets Bonds||2.87%||Goldman Sachs Local Emerg Mkts Dbt Instl||GIMDX||3.58%||With bond yields increasing this week, bond prices fell. However, emerging market bonds continue to perform better than their developed market peers.|
|Municipal Bonds||High Yield Muni||0.74%||Goldman Sachs High Yield Muni Instl||GHYIX||1.30%||With muni bonds yields increasing, high yield bonds saw modest gains.|
Performance Snapshot: Top Fund
The fund’s largest holding is in Tencent Holdings Ltd (HKG:0700), which is up over 78% on a year-to-date basis.
The following table provides the top-performing mutual funds on a YTD basis as of September 15, 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||48.79%||1.76%||51.8%||$ 131||Financial Services|
|Morgan Stanley Inst International Opp IS||MNOPX||Foreign Large Cap Growth Equities||45.04%||5.64%||46.6%||$ 329||Consumer Defense|
|Wasatch Emerging India Institutional||WIINX||India Equities||43.52%||2.00%||35.3%||$ 232||Financial Services|
|Matthews China Small Companies||MCSMX||China Equities||42.02%||2.24%||35.7%||$ 24||Industrials|
|Matthews Asia Innovators Institutional||MITEX||China Equities||41.22%||1.01%||33.3%||$ 166||Technology|
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