There is no doubt a lot of nervousness and anxiety about what is happening in the markets these days. With the strain on the financial sector and downward trend of the overall markets, investors are wondering what to do with their funds, hoping to avoid steep loses themselves. The question arises, should I keep my finds locked up in money market accounts and CD’s to be safe, or invested in the market where the risks are always higher?
If you are investing for the long term, say 3 years or longer, than it might make sense to take a look at some mutual funds that have performed well over the past 3 years. Which means they have weathered some pretty heavy storms and have still come out quite strong. These are the kind of funds that might be a good bet during the next 3 years. Most analysts agree that the market could be in for a long hard road.
Some funds that have performed extremely well over the past 3 years, and 2 of the 3 have good long-term track records.
In the next few paragraphs, I’ve listed some funds that have performed extremely well over the past 3 years, and 2 of the 3 have good long-term track records. Of course past performance does not guarantee future performance, especially in these times, but these are very tempting funds that you may want to take a look at. Long term investing in funds that perform well will make retirement more enjoyable.
The first fund to look at is Merk Hard Currency (symbol: MERKX). This is an interesting investment as it invests in things like foreign currencies and gold. The fund holds currencies from countries with stable economies and politics. You can hold on to this fund long term as a hedge against, or in conjunction with more traditional stock mutual funds. It is also a hedge against a falling or weakening U.S. dollar. This year, the fund has only lost around 2% and it has gained 8% over the past 3 years. Not bad in these times. The downside is that the fund is relatively new and does not have a longer-term track record. The fund manager is Axel Merk. There is no transaction fee for the fund and the expense ratio is 1.3%.
No transaction fees and an expense ratio less than 1% make this a desirable fund to own.
The second fund is Parnassus Equity Income (symbol: PRBLX). This fund has a five star Morningstar rating over 3, 5, and 10 years. Year to date it has only lost 2.75% of its value and over 3 years it has gained 8.2%. 80% of the funds portfolio pays interest or dividends. It contains household names that are heavy hitters and strong companies. Johnson and Johnson, 3M, Microsoft to name a few. No transaction fees and an expense ratio less than 1% make this a desirable fund to own. The fund’s manager is Todd Ahlsten who has been on the job since 2001 for this fund.
The third fund is Hartland Value Plus (symbol: HRVIX). Combined with the 2 funds discussed previously, this mutual fund seems to offer a great mix in these difficult times. The companies held in this fund are smaller companies with market capitalization of between $300 million and $3 billion dollars. They are fewer companies in the fund than normal, generally 40 to 60, and there is a good mix of mostly manufacturing, service and information technology companies. A few of the companies have exceeded 30 or 40% stock growth this year! Also, the fund actually gained 6.5% in 2008 and over the past 3 years the fund gained 8.3%. The 10-year track record is 11.1%, which makes this a fantastic play in the short AND long term. The downside to this fund if there is one, is that the managers both have less than 3 years experience managing the fund. But they are doing a great job so far.
So there you have it, some great funds to consider in these difficult times. Whether the market has hit the bottom or not, no one really knows, but investing in strong funds and keeping your holdings diverse could be the way to hold on to more of what you’ve got.