PIMCO Fund Family Has Excelled During Downturn
Family values really mean something for mutual fund families.
Investment returns can either keep investors loyal or have them running for the exits, and some fund families have performed better than others during the downturn.
While investors can choose any fund from any fund family they wish, they often keep much of their money with one family because their retirement plan requires it or they find it more convenient and cost-effective. Since they may switch among that fund family's offerings over time, the overall strength of its available offerings looms large.
The PIMCO fund family gets a gold star for insight and early detection of the housing and mortgage debacles, resulting in strong results throughout many of its funds over the past three years.
"PIMCO and the strength of its bond portfolios has really stood out as a perceived advantage for it during the downturn," noted
While the average U.S. stock fund is up 13 percent and the average long-term bond fund up 10 percent this year, their respective two-year returns are a negative 18 percent and a gain of 2 percent, according to Lipper.
Mutual fund investors have been nervous, pulling
"It's been an especially difficult time for fund companies concentrated in equities," said Tjornehoj. "Even though things look better this year than last, assets have been down just about everywhere."
The smallest fund families with only a few million dollars under management are "extremely vulnerable" right now, Tjornehoj said. The largest fund families seem equipped to weather the storm with deep research staffs uncovering investment opportunities, yet have a lot of infrastructure to support, he added.
"Since market timing is too hard of a game to play, dollar-cost averaging (investing a set amount regularly in a fund) is the best strategy to stick with in good and bad times," said
That also means monitoring what their fund families are doing.
Top fund families besides PIMCO in overall three-year performance of their funds, according to
-- Janus, known for bold growth funds, rebounded in the past three years from its poor performance in the previous bear market. It landed in the top one-fourth in all bond and stock asset classes. It has, however, had key manager changes that included its largest funds,
-- MFS under chief investment officer
Here, ranked by
Fund giant Fidelity's hiring of a raft of research analysts several years ago has yet to bear fruit,
Equipped with fund family knowledge, investors must now look ahead. The categories hurt most in the downturn have actually enjoyed the biggest recent boosts, said Dolan, specifically high-yield bonds, emerging-market bonds and stocks, and technology stocks.
"It has been hard for mutual funds to escape what the market is doing on the upside or downside," said
Investing - PIMCO Fund Family Has Excelled During Downturn
(c) 2009 TRIBUNE MEDIA SERVICES, INC.