NoLoad FundX editor Janet Brown discussed the strength of U.S. growth funds on Chuck Jaffe’s MoneyLife Show on Tuesday July 24, 2012. Jaffe is a senior columnist at Marketwatch and host of the lively web-based MoneyLife show. (Jason Brown, FundX chief investment officer, was on Jaffe’s MoneyLife show last month.)
“U.S. growth funds continue to rank ahead of value in all size categories,” Janet said. Technology has been a hot spot in the growth trend and Janet pointed to the strong performance of Powershares QQQ, an ETF that tracks the tech-heavy Nasdaq 100 index. But there are also some value plays in the current market, Janet said: “Even in a growth market, some value funds are doing well.” She noted value funds like Yacktman Focus and Weitz Partners Value, which recently rose up the ranks in NoLoad FundX.
While U.S. growth funds have been leading foreign funds, Janet reminded MoneyLife listeners that the NoLoad FundX Upgrading strategy can take advantage of market trends around the world. “We are truly global managers,” she said. “We believe that investors these days have to have a global outlook in order to succeed over time. We’ve been able to identify fairly long periods of time when international outperforms domestic and vice versa. We’re going for these larger trends, rather than bouncing back and forth.”
In the “Hold ‘em or fold ‘em” part of the show, Janet answered questions from callers. Both Vanguard Total International Stock Index Fund (VGTSX) and Vanguard MSCI Emerging Markets ETF (VWO) made Janet’s sell list because these funds haven’t performed as well as domestic funds. VWO was one of her favorite emerging market funds, she said, but it’s only up 2% year-to-date. “If you’re willing to be active, you can do better,” Janet told the caller.
Funds like Vanguard Equity Income (VEIPX), Fidelity Growth and Income (FGRIX), and Brown Advisory Growth Equity (BIAGX), however, were buys because they were doing well in the current growth market.
But Janet reminded investors that “Market’s change and these recommendations are going to change.”