Last week, the major market averages started lower but moved higher into the weekend.

This shift was influenced by poor economic data from China, highlighting a weakening global economy, and rising tensions in the Middle East, which initially set a negative tone. However, optimism grew as the Federal Reserve appeared to engineer a soft landing, boosting stocks by Thursday. Retail sales for September exceeded expectations, rising 0.4% month-over-month compared to forecasts of 0.3% and an increase of 0.1% in the previous month. The earnings season painted a bullish picture, with about 13% of S&P 500 companies reporting and approximately 75% surpassing earnings expectations—aligning with historical averages and indicating a strong economic environment.

Looking ahead to next week, the earnings season continues with several major bellwether companies set to report, where guidance will be a key factor as investors assess how the business and consumer climate is reacting to lower interest rates. Economic data releases will be light, but durable goods orders will be a focal point; analysts expect a slight 0.2% increase after no change last month. Initial jobless claims will also be monitored, with investors hoping for numbers that are good but not too strong, potentially increasing the chances of another rate cut at the next central bank meeting. Additionally, several Federal Reserve governors are scheduled to speak now that the central bank’s quiet period has ended.

Given this economic backdrop, let us see how this impacts the performance of various investment strategies.

Overall, for the rolling month the broader markets continued to move up.

Chinese equity continued to remain in the positive territory over the rolling month, while some long-duration bond strategies continued to struggle.

U.S Equity Strategies

Among U.S. equities, several growth strategies continued to post solid gains for the rolling month.

Winning

• Morgan Stanley Institutional Fund, Inc. Growth Portfolio (MSEGX), up 9.26%
• Hood River Small-Cap Growth Fund (HRSMX), up 9.01%
• First Trust US Equity Opportunities ETF (FPX), up 7.89%
• iShares Russell Mid-Cap Growth ETF (IWP), up 6.16%
• iShares Russell 2000 Value ETF (IWN), up 2.89%
• iShares Core S&P U.S. Value ETF (IUSV), up 2.64%

Losing

• JPMorgan Investor Conservative Growth Fund (ONCFX), down -0.23%
• Vanguard Developed Markets Index Fund (VDIPX), down -0.8%

Dividend Strategies

Quality dividend strategies posted moderate gains, while international dividend strategies were in the red for the rolling month.

Winning

• HCM Dividend Sector Plus Fund (HCMNX), up 5.7%
• Invesco BuyBack Achievers ETF (PKW), up 5.62%
• First Trust Rising Dividend Achievers ETF (RDVY), up 4.96%
• BNY Mellon Equity Income Fund (DQIRX), up 4.21%

Losing

• Janus Henderson Global Equity Income Fund (HFQAX), down -0.31%
• Principal Global Diversified Income Fund (PGBAX), down -0.57%
• iShares International Select Dividend ETF (IDV), down -1.72%
• SPDR® S&P International Dividend ETF (DWX), down -3.7%

U.S. Fixed Income Strategies

In US fixed income, convertible and high yield bond plays continued to post modest gains, while long-duration bond strategies struggled.

Winning

• ProShares Short 20+ Year Treasury (TBF), up 5.37%
• iShares Convertible Bond ETF (ICVT), up 3.78%
• Fidelity® Capital & Income Fund (FAGIX), up 1.99%
• Fidelity Advisor® High Income Advantage Fund (FAHYX), up 1.87%

Losing

• SPDR® Portfolio Long Term Treasury ETF (SPTL), down -5.32%
• iShares 20+ Year Treasury Bond ETF (TLT), down -5.94%
• Vanguard Extended Duration Treasury Index Fund (VEDIX), down -7.16%
• PIMCO Extended Duration Fund (PEDPX), down -7.82%

Foreign Equity Strategies

Among foreign equities, Chinese equity strategies continued to post solid gains.

Winning

• WisdomTree China ex-State-Owned Enterprises Fund (CXSE), up 22.47%
• SPDR® S&P China ETF (GXC), up 21.32%
• Fidelity® China Region Fund (FHKCX), up 14.37%
• Fidelity® Emerging Asia Fund (FSEAX), up 12.81%

Losing

• Columbia Acorn International Fund (ACINX), down -2.76%
• iShares MSCI Brazil ETF (EWZ), down -5.17%
• Fidelity® Puritan® Fund (FPUKX), down -5.45%
• SPDR® Dow Jones International Real Estate ETF (RWX), down -5.6%

Foreign Fixed Income Strategies

Emerging market debt strategies posted marginal gains over the rolling month.

Winning

• VanEck Emerging Markets High Yield Bond ETF (HYEM), up 0.71%
• John Hancock Funds Emerging Markets Debt Fund (JEMIX), up 0.25%
• Fidelity Advisor® New Markets Income Fund (FNMIX), up 0.08%

Losing

• iShares J.P. Morgan USD Emerging Markets Bond ETF (EMB), down -0.95%
• iShares International Treasury Bond ETF (IGOV), down -3.07%
• Eaton Vance Emerging Markets Local Income Fund (EEIIX), down -3.45%
• SPDR® Bloomberg Barclays International Treasury Bond ETF (BWX), down -3.68%
• Templeton Global Bond Fund (TGBAX), down -4.95%

Alternatives

Among alternatives, several Japanese hedged equity strategies posted gains over the rolling month.

Winning

• WisdomTree Japan Hedged Equity Fund (DXJ), up 7.25%
• iShares Currency Hedged MSCI Japan ETF (HEWJ), up 6.17%
• Janus Henderson Contrarian Fund (JCNCX), up 5.48%
• Fidelity® Contrafund® Fund (FCNKX), up 4.55%

Losing

• Janus Henderson Mortgage-Backed Securities ETF (JMBS), down -2.38%
• Columbia Mortgage Opportunities Fund (CLMAX), down -3.27%
• ETFMG Alternative Harvest ETF (MJ), down -5.03%
• PIMCO TRENDS Managed Futures Strategy Fund (PQTIX), down -5.31%

Sectors

Among the sectors and industries, mortgage and Chinese tech strategies were the top performers.

Winning

• iShares Mortgage Real Estate Capped ETF (REM), up 50%
• Invesco China Technology ETF (CQQQ), up 26.9%
• Fidelity® Select Brokerage & Invmt Mgmt Portfolio (FSLBX), up 9.48%
• Fidelity® Select Semiconductors Portfolio (FSELX), up 8.82%

Losing

• ProShares Short QQQ (PSQ), down -4.84%
• Invesco Solar ETF (TAN), down -6.95%
• MassMutual Select Blue Chip Growth Fund (MBGFX), down -9.8%
• iShares Developed Real Estate Index Fund (BARDX), down -18.1%

Every week, MutualFunds.com provides a snapshot of the performance of some key mutual funds and ETFs to highlight the trending investment strategies across different sectors, geographic regions, asset classes and themes. MutualFunds.com uses a proprietary system to scan through thousands of relevant mutual funds and ETFs. Fund performance data is calculated for the trailing one month, based on the change in NAV.


Here is a summary of the different strategies covered in this article:

• U.S. equity strategies typically cover different equity investing styles (growth/value/blend) and market capitalizations (small/mid/large).
• Dividend strategies focus on generating income via different equity routes (high yield/dividend growth/foreign dividend/quality dividend)
• U.S. fixed income strategies focus on debt securities issued by U.S. entities and can cover different types of debt (corporate/municipal/high-yield/investment-grade/government/asset-backed) and maturity profiles (short/medium/long).
• Foreign equity strategies cover equity strategies applied to non-U.S. markets based on the level of economic growth (emerging/developed), regions (Asia/Europe/Africa), and market capitalizations (small/mid/large).
• Foreign fixed-income strategies focus on debt securities issued outside the U.S. markets and can cover different regions (Asia/Europe/Africa) and regions based on the level of economic development (emerging/developed).
• Alternative strategies cover non-traditional investments (currencies, hedge funds strategies, derivatives, volatility-based), real estate, and commodities.
• Sector strategies cover dedicated exposure to various sectors of the U.S. economy including technology, healthcare, financial, and industrial among others.