Top Rated No Load Mutual Funds for 2014
AlphaProfit Provides New Recommendations of Top Rated No Load Mutual Funds for 2014
The AlphaProfit No-Load, No-Transaction-Fee Growth Model Portfolio is reconstituted on May 21, 2014 with top rated no load mutual funds in the large cap, small cap, foreign, and specialty categories.
Stock prices around the world have moved erratically following their near straight line advance in 2013.
After starting 2014 on a down note, the S&P 500 bottomed in early February. Since then, it has managed to set a series of higher highs despite pulling back periodically. The index has topped 1,900 for the first time.
The Fidelity Spartan 500 Index (FUSEX) and Schwab S&P 500 Index (SWPPX) that track the S&P 500 index ($SPX) are now up 2.4%.
Small cap stocks have diverged from large caps.
The small cap proxy Russell 2000 Index ($IWM) enjoyed a sharp double-digit gain in February. Small caps have however trended lower after peaking in early March.
The Fidelity Spartan Small Cap Index (FSSPX) and Schwab Small Cap Index (SWSSX) that track the Russell 2000 Index are both down 4.8%.
Small cap growth mutual funds have been particularly hit hard as last year's biotech, consumer discretionary, and Internet high fliers like Regeneron (REGN), Tesla (TSLA), and Twitter (TWTR) have borne the brunt of the correction. According to Morningstar, the average small cap growth mutual fund is down 15.9% since March 4.
Foreign stocks have seen a reversal in fortune after bottoming at the end of January.
Fidelity Spartan International Index (FSIIX) that tracks the MSCI EAFE index is up 2.4% for the year.
Emerging markets have fared better than developed markets during this rally.
The Fidelity Spartan Emerging Markets Index (FPEMX) that tracks the FTSE Emerging Index is up 4.1% in 2014.
From a regional perspective, Latin American stocks have led the way.
Fidelity Latin America (FLATX) for example is up 4.7% for the year.
Many European markets have fared better than the MSCI EAFE developed markets proxy. Fidelity Europe (FIEUX) that invests across the continent is up 2.8%.
Japanese stocks meanwhile have lagged. Fidelity Japan (FJPNX) is down 6.7%.
Discussing the recent performance of the U. S. stock market, Dr. Sam Subramanian, Editor of AlphaProfit's Premium Service Investment Newsletter said, 'Expectations for U. S. economic growth were high going into 2014. While the unseasonably cold winter slowed growth early in the New Year, the pick up since then has not been particularly robust. A major surprise this year is the 60 basis point drop in the 30-year Treasury bond yield. Meanwhile, foreign stocks have been largely driven by expectations for stimulus in Europe and China to spur growth.'
During the past 12 months, AlphaProfit subscribers benefited from gains made by top rated no load domestic mutual funds like Putnam Equity Spectrum (PYSAX) and Glenmede Large Cap Core (GTLOX) that are up a market-beating 24.1% and 20.2%, respectively.
Additionally, top rated no load foreign mutual funds Fidelity Nordic (FNORX) and Oakmark International Small Cap (OAKEX) outperformed the MSCI EAFE foreign stock benchmark rising 37.4% and 15.9%, respectively.
Outlook for Top Rated No Load Mutual Funds
Economic data are mixed.
Retail sales and industrial production data for example were weaker than expected in April while housing starts rose the highest in five months.
Meanwhile, first quarter corporate earnings are fair.
According to FactSet, 75% of S&P 500 companies have exceeded analysts' EPS forecasts while 54% have beaten sales forecasts.
Index members have bettered profit as well as revenue growth forecasts at the start of the reporting season.
Dr. Subramanian says, 'Mixed economic data and adequate corporate earnings are usually not a cause for concern. They however are now worrisome, given where stock valuation metrics stand.'
Pockets of the market are richly valued. The technology-heavy Nasdaq Composite trades at 35 times reported earnings compared to a 17 multiple for the S&P 500.
Offsetting these negatives, the Federal Reserve remains inclined to support economic growth as inflation and employment are far from the central bank's targets.
Given a supportive Federal Reserve and pockets of overvaluation, Dr. Subramanian believes stocks are likely to be range-bound near-term.
He says, 'Stock prices are likely to correct at a sector level rather than at a market level. The lower end of this trading range can however extend to the 1740 level on the S&P 500 if tension in Ukraine escalates or slowing growth in China stokes global economic concerns.'
Dr. Subramanian is more sanguine in his longer-term outlook. He believes broad U. S. stock indices can make more new all-time highs before the next bear market.
'Stocks can get another leg up after this transition phase if the Fed keeps interest rates low for a substantial period after eliminating monthly bond purchases. This can help economic expansion and corporate earnings growth to accelerate. Valuation metrics would then look less onerous', he adds.
Top Rated No Load Mutual Funds for 2014
AlphaProfit's no-load, no-transaction-fee (NL-NTF) growth model portfolio is repositioned with top rated no load mutual funds on May 21. Learn more about AlphaProfit's Fidelity fund recommendations and fund model portfolios.
Since 2009, the NL-NTF growth model portfolio has gained at a 16.0% annual rate beating the 12.7% rate for its benchmark consisting of broad U. S. and foreign indexes.
Stated differently, the AlphaProfit NL-NTF Growth Model Portfolio has helped Premium Service subscribers earn 34% more money than index investors.
The NL-NTF growth model portfolio's outperformance was driven by contributions from several top rated no load mutual funds.
AlphaProfit subscribers benefited from the selection of top rated no load domestic mutual funds like ASTON/Fairpointe Mid Cap (CHTTX), Fidelity Small Cap Discovery (FSCRX), Janus Venture (JAVTX), Janus Triton (JATTX) and Parnassus Endeavor (PARWX) that have all more than tripled since 2009.
Among top rated no load foreign mutual funds, subscribers benefited from Westcore International Small Cap (WTIFX), Wasatch International Growth (WAIGX), Harding Loevner Intl Small Company (HLMSX), Oakmark International (OAKIX), and Matthews Korea (MAKOX) that have trounced the MSCI EAFE benchmark more than two-to-one during this period.
Looking ahead to the repositioning Dr. Subramanian said, 'Our primary objective is to help subscribers protect their gains through judicious asset allocation and mutual fund selection in what could be the most difficult phase of 2014. This phase could also provide exciting buying opportunities. In this context, we look forward to enabling subscribers increase allocation to top rated no load mutual funds before the next leg of the bull market begins in earnest .'
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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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