FundX President Janet Brown’s Take on 5 Funds & ETFs

March 9, 2018

After a strong run, markets around the world fell in February. What asset classes are doing well now and which ones should you avoid?

FundX President Janet Brown answered these questions and more on Chuck Jaffe’s MoneyLife Show on March 8, 2018.

“Foreign generally fell back a little more than U.S. stocks; large-cap U.S. growth funds are still dominating the top ranks,” Janet explained.

“The market changes. It’s impossible to forecast. Invest based on what you know, not what you think is going to happen.”

Janet also spoke about Upgrading, which is FundX’s systematic way of aligning with what’s working in the current market environment. Janet explained that investors can apply the Upgrading approach to different asset classes and risk levels.

Get Janet’s take on five funds and ETFs

Janet answered investor questions in the ‘Hold it or Fold it’ segment of the show. (FundX members may notice that not all of these funds are covered in NoLoad FundX.)

1. Vanguard U.S. Momentum Factor ETF (VFMO)

“We’re big fans of momentum, which we prefer to call persistence of performance. It works,” Janet said. “This is a new fund. If you’re one of the few who have already bought it, I’d hold it. But it’s new and very small, and there are better funds.

One momentum fund and ETF that we love and have held for more than a year is iShares MSCI US Momentum (MTUM). It remains very highly ranked, has a good handle on risk, and continues to do well. I’d go for that over VFMO.”

2. FirstTrust ValueLine Dividend Index ETF (FVD)

“Dividend funds really face an uphill battle as interest rates rise. They had their heyday a few years ago. They did well for a couple years, but right now growth funds are leading. Don’t fight it. This fund is a sell.”

3. VanEck Vectors Morningstar Wide Moat ETF (MOAT)

“This fund is surprisingly volatile considering that it’s marketed as a conservative fund. I’m not a big fan of MOAT. I prefer PowerShares QQQ (QQQ), which tracks the tech-heavy NASDAQ 100 index, iShares Russell 1000 Growth (IWF), or even iShares Dow Jones Industrial Average (DIA). MOAT is a sell.”

4. Ridgeworth Seix Floating Rate High Income (SAMBX)
now known as Virtus Seix Floating Rate High Income (SAMBX)

“Floating-rate funds have been doing very well. As short-term rates rise, the coupon on floating-rate funds also rises.

We don’t own this particular fund, but I’d certainly buy it as part of a fixed-income portfolio. Just keep in mind that there is some credit risk if the economy slows.”

5. Vanguard Core Bond Investor Fund (VCORX)

“Intermediate-term bonds are struggling this year as rates rise,” Janet said. “This is a great example that high quality doesn’t always mean low risk. It’s a tough environment for fixed income and core funds, and this fund is a sell.

Listen to Janet’s full interview with MoneyLife host Chuck Jaffe here:

Print Friendly, PDF & Email

Previous post:

Next post: