Bond funds do well for the most part as investors flee risk
By Jamie Smith Hopkins, The Baltimore Sun
July 18, 2010
Mutual funds specializing in stocks had a rotten second quarter nationwide.
International debt problems, falling U.S. housing starts and disappointing job numbers pushed jittery investors from stocks to bonds, a sharp change from the first quarter.
U.S.-managed equity mutual funds fell nearly 11 percent on average during the quarter, according to research firm Lipper Inc. Bond funds rose 1.2 percent — and those in Treasuries, thought to be among the safest investments, did particularly well.
Mutual funds managed in Maryland were no exception. Just three equity funds based in the state ended the April-June stretch with positive returns, according to a Baltimore Sun analysis of data provided by Bloomberg News.
One of those funds, managed by Rockville-based Rydex SGI, focuses on precious metals — a popular investment when people are feeling bearish. The other two, which invest in U.S. and international stocks, are managed by Hussman Investment Trust of Ellicott City with a goal of "defending capital during unfavorable market conditions," according to the company's website.
"Equities absolutely took it on the chin as investors turned their backs on risky assets," said Jeff Tjornehoj, a senior research analyst at Lipper. "Now that was also the reason why Treasury products did very well at the same time. So you had two different markets [that] really had one thing in common — which was risk, and how to get away from it."
Bill Miller's Value Trust fund at Baltimore-based Legg Mason dropped 16 percent, one of the biggest local declines. It's been a roller-coaster ride for the well-known stock picker's fund, which plummeted in value in 2008 and made up some of the losses in 2009 before turning south again.
Most Maryland-managed bond funds ended the quarter in positive territory — including one each at Rydex SGI, ProFunds in Bethesda and T. Rowe Price in Baltimore that produced double-digit returns. All three focused on Treasuries.
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Mutual fund report: second quarter 2010
Equity top five
TickerFund name2nd Quarter performance
HSGFXHussman Strategic Growth Fund 5.57 percent
HSIEXHussman Strat Int Equity Fund1.41 percent
RYMSXRydex SGI Multi-Hedge Strateg-H-1.85 percent
GRSPXGreenspring Fund Inc.-2.73 percent
PRASXT. Rowe Price New Asia-2.89 percent
Equity sector top five
TickerFund name2nd Quarter performance
RYZCXRydex Series Precious Mtl-C5.20 percent
RYCUXRydex Series Utilities-C-4.46 percent
TRREXT. Rowe Price Real Estate Fund-4.58 percent
TISHXDWS Communications Fund-A-4.63 percent
RYREXRydex Series Real Estate-A-4.91 percent
Bonds top five
TickerFund name2nd Quarter performance
GVPIXProFunds US Government PL-IN19.02 percent
RYCGXRydex Series Govt Long Bond-C18.37 percent
PRULXT. Rowe Price US Treas Long11.68 percent
PRTIXT. Rowe Price US Treas Intmed5.46 percent
GGGGXDWS GNMA Fund-A4.13 percent
Equity bottom five
TickerFund name2nd Quarter performance
PRESXT. Rowe Price European Stock-17.71 percent
VLCPXMTB Large Cap Growth Fund-A-16.67 percent
RYFRXRydex SGI Series Intl Opportun-A -16.40 percent
LMVTXLegg Mason Cap Mgmt Value-C-16.09 percent
LMGEXLegg Mason Btrymch Int Eq-C-15.78 percent
Equity sector bottom five
TickerFund name2nd Quarter performance
CGAEXCalvert Global Alt Energy Fund-A-18.56 percent
RYCFXRydex Series Biotech-C-17.02 percent
RYVCXRydex Series Energy Serv-C-16.96 percent
PEOPetroleum & Resources Corp.-15.80 percent
PRNEXT. Rowe Price New Era Fund-15.31 percent
Bonds bottom five
TickerFund name2nd Quarter performance
RPIBXT. Rowe Price Intl Int BD-2.59 percent
PRHYXT. Rowe Price High Yield-Inv-0.86 percent
FYAIXProFunds Access Flex High Yield-IV-0.45 percent
HYBNew America High Income Fund0.02 percent
PSBAXPNC Ultra Short Bond Fund-A0.07 percent
Source: Bloomberg News
Note: For funds with several classes of shares, the oldest class was included in the ranking.
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From The Baltimore Sun published on July 18, 2010