Mutual Funds Scorecard: March 3 Edition

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Mutual Funds Scorecard: March 3 Edition

Mutual Fund Scorecard Image
Every fortnight, MutualFunds.com provides a snapshot of the performance of some key mutual funds which tries to accurately capture the investor interest in specific areas of the financial markets. The report is aimed at providing a quick overview of the sectors, regions and asset classes that moved in a meaningful manner during the last two weeks.

 

  • Total long-term flows continued to be positive for the two weeks ended February 19, enjoying an overall strong start to the year. Flows have been positive for the past six weeks now. As usual, total bond inflows were stronger than equity outflows.
  • Equities experienced more than $6 billion in withdrawals due to domestic negative flows, including large-cap and multi-cap. The $10 billion in outflows were offset by positive flows in the rest of the world.
  • Meanwhile, bonds enjoyed nearly $22 billion in inflows thanks to strong investment grade, multisector and municipal bond mutual funds.
  • The positive picture in flows was in contrast to the panic in global markets, as the coronavirus threat reached European shores and appears unlikely to abate anytime soon. Italy is the most hit country in Europe, while China, Iran and South Korea have reported the most cases in the world. So far, the virus has infected 90,000 people worldwide and killed more than 3,000.
  • Federal Reserve officials believe the current monetary policy stance is appropriate, signaling that interest rates will stay at the current low level for a while. However, if the coronavirus threat hits trade and the economy, the Fed is likely to cut interest rates in order to boost the economy. The Fed warned of possible dangers related to the coronavirus, although the issue was in its infancy at the time of the policymakers’ meeting.
  • The European Central Bank was cautiously optimistic about the eurozone’s growth outlook before the coronavirus fears hit. It said data suggested that Europe’s economy was recovering, although it noted that global trade remained subdued due to trade tensions between China and the U.S.
  • The sentiment in the German manufacturing sector improved substantially in February, although it remains in contraction territory at 47.8. The German flash manufacturing purchasing managers’ index posted its best result in more than a year. Next month the impact of the coronavirus will be baked into the figure.
  • For a better indicator of how the coronavirus could hit sentiment in the manufacturing and services sector, China offers an example. The Chinese manufacturing PMI tumbled to 35.7 in February, from 50 in the prior month, and is well below analyst expectations of 45.1. The non-manufacturing PMI’s drop was even worse, at 29.6 from 54.1. Analysts had expected a drop to 51.4.

We provide this report on a fortnightly basis. To stay up to date with mutual fund market events, come back to our news page here.

Broad Indices

  • As expected, the broad indices have declined abruptly over the past two weeks, with most of them posting two-digit drops. Meanwhile, bonds posted positive performance, as they benefited from their safe-haven status.
  • Vanguard’s S&P 500 index fund (VFINX) lost 12.53% of its value over the past two weeks, becoming the worst performer from the pack.
  • At the same time, Vanguard’s total bond market index fund (VBMFX) gained 1.78%, the best performer. The fund recorded the weakest performance last time.
Broad Indices Performance March 3, 2020

Major Sectors

  • Sectors were all down, with only one managing to post single-digit losses.
  • Vanguard’s financial sector fund (VFAIX) was hit the hardest, losing 14.65% of its value over the past two weeks.
  • Fidelity’s real estate sector fund (FRIFX) is again the best performer from the pack, although this time with a loss of 4.49%.
Major Sectors Performance March 3, 2020

Foreign Funds

  • Foreign funds were all down, but not as much as U.S. equities.
  • Chinese equities fund (MICDX) was the surprising best performer from the bunch with a fall of 2.65%. The fund outperformed for the second consecutive time.
  • T. Rowe’s Latin America fund (RLAIX) shed 10.95% of its value and became the worst performer from the pack.
Foreign Funds Performance March 3, 2020

Major Asset Classes

  • In major asset classes, the picture was decidedly more mixed than elsewhere. Five assets posted positive performance, with the rest coming in negative.
  • PIMCO’s long-term bonds fund (PEDIX) outperformed the pack by far, advancing 9.82%, as investors plowed their money into safe-haven assets.
  • Vanguard’s broad market-cap fund (VFINX) was the worst performer here as well, tumbling 12.53%.
Major Asset Classes Performance March 3, 2020

The Bottom Line

Flows were positive for six consecutive weeks, due to strong inflows in bond mutual funds failing to offset outflows from equities. Most global markets have entered correction mode as the coronavirus threat continues to expand at a very rapid pace and has now engulfed developed countries such as Italy and South Korea.

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Why 30 trillion is invested in mutual funds book

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Mutual Fund Scorecard Image

Mutual Funds Scorecard: March 3 Edition

Every fortnight, MutualFunds.com provides a snapshot of the performance of some key mutual funds which tries to accurately capture the investor interest in specific areas of the financial markets. The report is aimed at providing a quick overview of the sectors, regions and asset classes that moved in a meaningful manner during the last two weeks.

 

  • Total long-term flows continued to be positive for the two weeks ended February 19, enjoying an overall strong start to the year. Flows have been positive for the past six weeks now. As usual, total bond inflows were stronger than equity outflows.
  • Equities experienced more than $6 billion in withdrawals due to domestic negative flows, including large-cap and multi-cap. The $10 billion in outflows were offset by positive flows in the rest of the world.
  • Meanwhile, bonds enjoyed nearly $22 billion in inflows thanks to strong investment grade, multisector and municipal bond mutual funds.
  • The positive picture in flows was in contrast to the panic in global markets, as the coronavirus threat reached European shores and appears unlikely to abate anytime soon. Italy is the most hit country in Europe, while China, Iran and South Korea have reported the most cases in the world. So far, the virus has infected 90,000 people worldwide and killed more than 3,000.
  • Federal Reserve officials believe the current monetary policy stance is appropriate, signaling that interest rates will stay at the current low level for a while. However, if the coronavirus threat hits trade and the economy, the Fed is likely to cut interest rates in order to boost the economy. The Fed warned of possible dangers related to the coronavirus, although the issue was in its infancy at the time of the policymakers’ meeting.
  • The European Central Bank was cautiously optimistic about the eurozone’s growth outlook before the coronavirus fears hit. It said data suggested that Europe’s economy was recovering, although it noted that global trade remained subdued due to trade tensions between China and the U.S.
  • The sentiment in the German manufacturing sector improved substantially in February, although it remains in contraction territory at 47.8. The German flash manufacturing purchasing managers’ index posted its best result in more than a year. Next month the impact of the coronavirus will be baked into the figure.
  • For a better indicator of how the coronavirus could hit sentiment in the manufacturing and services sector, China offers an example. The Chinese manufacturing PMI tumbled to 35.7 in February, from 50 in the prior month, and is well below analyst expectations of 45.1. The non-manufacturing PMI’s drop was even worse, at 29.6 from 54.1. Analysts had expected a drop to 51.4.

We provide this report on a fortnightly basis. To stay up to date with mutual fund market events, come back to our news page here.

Broad Indices

  • As expected, the broad indices have declined abruptly over the past two weeks, with most of them posting two-digit drops. Meanwhile, bonds posted positive performance, as they benefited from their safe-haven status.
  • Vanguard’s S&P 500 index fund (VFINX) lost 12.53% of its value over the past two weeks, becoming the worst performer from the pack.
  • At the same time, Vanguard’s total bond market index fund (VBMFX) gained 1.78%, the best performer. The fund recorded the weakest performance last time.
Broad Indices Performance March 3, 2020

Major Sectors

  • Sectors were all down, with only one managing to post single-digit losses.
  • Vanguard’s financial sector fund (VFAIX) was hit the hardest, losing 14.65% of its value over the past two weeks.
  • Fidelity’s real estate sector fund (FRIFX) is again the best performer from the pack, although this time with a loss of 4.49%.
Major Sectors Performance March 3, 2020

Foreign Funds

  • Foreign funds were all down, but not as much as U.S. equities.
  • Chinese equities fund (MICDX) was the surprising best performer from the bunch with a fall of 2.65%. The fund outperformed for the second consecutive time.
  • T. Rowe’s Latin America fund (RLAIX) shed 10.95% of its value and became the worst performer from the pack.
Foreign Funds Performance March 3, 2020

Major Asset Classes

  • In major asset classes, the picture was decidedly more mixed than elsewhere. Five assets posted positive performance, with the rest coming in negative.
  • PIMCO’s long-term bonds fund (PEDIX) outperformed the pack by far, advancing 9.82%, as investors plowed their money into safe-haven assets.
  • Vanguard’s broad market-cap fund (VFINX) was the worst performer here as well, tumbling 12.53%.
Major Asset Classes Performance March 3, 2020

The Bottom Line

Flows were positive for six consecutive weeks, due to strong inflows in bond mutual funds failing to offset outflows from equities. Most global markets have entered correction mode as the coronavirus threat continues to expand at a very rapid pace and has now engulfed developed countries such as Italy and South Korea.

Be sure to sign up for your free newsletter here to receive the most relevant mutual fund updates.


Sign up for Advisor Access

Receive email updates about best performers, news, CE accredited webcasts and more.

Popular Articles

Download our free report

Find out why $30 trillon is invested in mutual funds.

Why 30 trillion is invested in mutual funds book

Why 30 trillion is invested in mutual funds book

Download our free report

Find out why $30 trillon is invested in mutual funds.

Why 30 trillion is invested in mutual funds book

Download our free report

Find out why $30 trillon is invested in mutual funds.


Read Next