Top Rated No Load Mutual Funds for 2011
AlphaProfit to Provide New Recommendations
The AlphaProfit No Load Mutual Fund model portfolio will be reconstituted on May 18 with top rated no load mutual funds in the domestic, foreign, and specialty categories.
As the calendar moves past the mid-point of the second quarter, investors are nervous on the outlook for both global growth and inflation.
Although the SPDR S&P 500 ETF (SPY) that tracks the popular namesake U. S. stock market benchmark is up about 7% for the year, volatility has increased and commodity prices have disconcertingly swooned.
Among foreign stock markets, those in developed European nations have fared well. Receiving a boost from a decline in the U. S. dollar vis-à-vis the euro, the Vanguard European ETF (VGK) is up nearly 8%.
Developed Pacific region markets as well emerging markets in general have been weaker performers. The Vanguard MSCI Pacific ETF (VPL) and the Vanguard Emerging Markets ETF (VWO) are both down for the year.
Discussing the recent performance of global stock markets, Dr. Sam Subramanian, Managing Principal of AlphaProfit Investments, LLC and Editor of AlphaProfit's Premium Service Investment Newsletter said, “Stock prices in the U. S. and developed European nations like Germany and France have benefited from strong corporate earnings.”
“Macro factors such as tightening monetary policies, political unrest, and falling commodity prices have pressured stock prices in emerging markets”, added Dr. Subramanian.
Elsewhere, Japan’s earthquake, tsunami, and nuclear crisis have impaired share prices in the third largest economy. Renewed concerns of Greece and Portugal defaulting on their debt have also unnerved investors.
Top Rated No Load Mutual Funds for 2011
AlphaProfit's no-load mutual fund model portfolio has gained at a 25% annual rate since the start of 2009, well in excess of the 17% rate for its benchmark comprising of broad U. S. and foreign indexes.
During this period, AlphaProfit subscribers benefited from the performance of foreign funds Matthews India (MINDX) and Wasatch International Growth (WAIGX) that rose 137% and 128%, respectively. Among U. S. mutual fund recommendations, Baron Opportunity (BIOPX) and Janus Triton (JATTX) more than doubled.
In recent months, AlphaProfit's cautious stance on foreign and emerging market investments has also helped performance.
Back on May 19, 2010 AlphaProfit cautioned readers on developed and emerging markets lagging the U. S. market. The SPDR S&P 500 ETF and iShares Russell 2000 Index ETF (IWM) are up 18% and 24%, respectively since October 2010 while the iShares MSCI EAFE ETF (EFA) and Vanguard Emerging Markets ETF are up just 11% and 6% respectively. See AlphaProfit Fund Guide: NTF Growth Model Portfolio Repositioned on 05-18-10
Dr. Subramanian currently sees tightening monetary policies and increasing austerity measures as two key factors working against global economic growth.
Inflation is rising in many parts of the world. The European Commission has raised its 2011 Euro region inflation forecast nudging the European Central Bank to increase interest rates.
In China, the nation's central bank has raised bank reserve requirements for the fifth time this year. Yet, inflation is running at a 5% annual rate and exceeding the government's target. This suggests further tightening is in the offing.
Meanwhile, the European debt crisis is forcing many countries including Greece, Ireland, Portugal and Spain to curb government spending. Spending cuts have already forced Portugal into recession and there is risk of others following suit.
Translating the above into investment implications, Dr. Subramanian said, "Investors should prepare portfolios for a slower growth environment. This however does not mean stocks have to be abandoned. All it means is one has to be more selective and invest in the right investing styles and regions of the world to make money."
Dr. Subramanian cites strong corporate earnings and robust merger & acquisition activity as positives.
In the U. S., 72% of companies reporting first-quarter results have exceeded analysts' earnings forecasts. In Europe, the corresponding number is 58%.
Holding more than $3 trillion in cash, global companies are actively seeking acquisitions as a means to grow revenue.
AT&T (T), Duke Energy (DUK), Johnson & Johnson (JNJ), and Sanofi-Aventis (SNY) are all engaged in acquisitions with a price tag of $20 billion or more.
Looking ahead to the new no load mutual fund recommendations, Dr. Subramanian said, "We have been dialing risk down in the past couple of months in our mutual fund, ETF, and stock recommendations. We intend to continue this process to help subscribers protect recent gains.”
"We are also looking to AlphaProfit's proven style rotation and fund selection system to help subscribers invest in top rated no load mutual funds to build on their 2011 gains," concluded Dr. Subramanian.
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AlphaProfit Investments, LLC is an independent investment research firm based in Sugar Land, TX. AlphaProfit publishes the AlphaProfit Sector
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with Fidelity funds and exchange-traded funds.
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