Money 70: The best mutual funds you can buy
Don't dwell on your losses. Focus on things you can control, like investing costs and consistency. That's what the MONEY 70 will help you do.
(Money Magazine) -- Could 2008 have been any worse for fund investors? As we went to press, not a single stock fund made money, and defying the laws of diversification, many bond funds fell too. Still, the MONEY 70, our recommended list of mutual and exchange-traded funds, held up better than most. More than 60% of our actively managed funds ranked in the top half of their categories last year; over the past five, 83% beat their peers.
Of course, category-trouncing performance isn't the mission of the MONEY 70, since no one can predict future returns. Instead, we provide a mix of high-quality funds - including index funds and ETFs - which you can use to build a diversified portfolio. We stick with the criteria that matter most, like low fees, which let you keep more of your returns. When it comes to actively managed funds, we also look for consistent strategies and experience. And we care how well funds treat their shareholders. So we pay attention to Morningstar's stewardship grades, which rate such factors as a fund group's culture and regulatory history. As for performance, we focus on funds that rank in the top half of their peers over five years but make exceptions when a manager's style is out of favor.
This year we're making only two switches. First, we're dropping Matrix Advisors Value because its assets slipped below our $100 million minimum. Funds that small pose a greater risk of raising fees or merging. If you own it, though, there's no reason to sell. We're then adding Allianz NFJ Small Cap Value, a fund that invests in dividend-paying small stocks and that recently reopened. We're also bringing back a former MONEY 70 fund that reopened, Third Avenue Small Cap Value, which buys undervalued high-quality stocks. To fit it in, we're dropping Bridgeway Small Cap Value - a fund we like but that tends to have wilder swings.
Whichever funds you choose, be patient. Whether the recovery takes another five months or five years, you can be sure that the low fees, consistent strategies and trustworthy management of the MONEY 70 funds will keep working in your favor.
Large Cap | ||||
Value | ||||
Fund | 1yr. | 5yrs. | Expenses (as % of assets) | Minimum initial investment |
American Funds American Mutual A | 24.9 | 2.1 | 0.60 | 250 |
Sound Shore | 28.3 | 1.2 | 0.92 | 10,000 |
T. Rowe Price Equity Income | 24.5 | 1.0 | 0.71 | 2,500 |
Vanguard Windsor II | 28.2 | 1.1 | 0.39 | 10,000 |
Blend | ||||
Fund | 1yr. | 5yrs. | Expenses (as % of assets) | Minimum initial investment |
Fairholme | 41.5 | 7.7 | 1.02 | 2,500 |
Fidelity Spartan 500 Index Investor | 25.4 | 0.7 | 0.10 | 10,000 |
Fidelity Spartan Total Market Index Inv | 27.0 | 1.1 | 0.10 | 10,000 |
FMI Large Cap | 28.3 | 5.1 | 1.00 | 1,000 |
iShares S&P 500 Index ETF | 0.0 | N.A. | 0.00 | N.A. |
Selected American Shares S | 28.8 | 1.1 | 0.92 | 1,000 |
Vanguard 500 Index Investor | 25.4 | 0.6 | 0.18 | 3,000 |
Vanguard Total Stock Mkt Idx | N.A. | N.A. | 0.18 | 3,000 |
Vanguard Total Stock Market ETF | N.A. | N.A. | N.A. | N.A. |
Growth | ||||
Fund | 1yr. | 5yrs. | Expenses (as % of assets) | Minimum initial investment |
American Funds AMCAP A | 36.4 | 1.6 | 0.74 | 250 |
Jensen J | 23.5 | 2.3 | 0.96 | 2,500 |
T. Rowe Price Blue Chip Growth | 41.1 | 1.5 | 0.80 | 2,500 |
Midcap | ||||
Value | ||||
Fund | 1yr. | 5yrs. | Expenses (as % of assets) | Minimum initial investment |
Fidelity Value | 42.5 | 0.2 | 0.76 | 2,500 |
Perkins Mid Cap Value J | 29.9 | 5.2 | 1.07 | 2,500 |
Blend | ||||
Fund | 1yr. | 5yrs. | Expenses (as % of assets) | Minimum initial investment |
FAM Value Inv | 21.2 | -0.1 | 1.40 | 500 |
Vanguard Mid Capitalization Index | 38.5 | 1.9 | 0.27 | 3,000 |
Vanguard Mid Cap ETF | N.A. | N.A. | N.A. | N.A. |
Growth | ||||
Fund | 1yr. | 5yrs. | Expenses (as % of assets) | Minimum initial investment |
FPA Perennial | 43.6 | 2.1 | 1.02 | 1,500 |
Meridian Growth | 35.5 | 2.9 | 0.86 | 1,000 |
PRIMECAP Odyssey Aggressive Growth | 52.3 | 4.6 | 0.80 | 2,000 |
Small-cap | ||||
Value | ||||
Fund | 1yr. | 5yrs. | Expenses (as % of assets) | Minimum initial investment |
Allianz NFJ Small Cap Value D | 23.1 | 4.2 | 1.22 | 1,000 |
Blend | ||||
Fund | 1yr. | 5yrs. | Expenses (as % of assets) | Minimum initial investment |
Third Avenue Small-Cap Value | 27.6 | 0.1 | 1.10 | 10,000 |
Royce Pennsylvania Mutual Invmt | 35.6 | 2.5 | 0.91 | 2,000 |
Vanguard Small Cap Index | 33.2 | 1.0 | 0.28 | 3,000 |
Vanguard Small Cap ETF | N.A. | N.A. | N.A. | N.A. |
Growth | ||||
Fund | 1yr. | 5yrs. | Expenses (as % of assets) | Minimum initial investment |
Royce Value Plus Svc | 37.9 | 2.2 | 1.48 | 2,000 |
T. Rowe Price New Horizons | 43.4 | 2.1 | 0.84 | 2,500 |
Multicap | ||||
Bridgeway Aggressive Investors 2 | 26.6 | -1.3 | 1.20 | 2,000 |
Muhlenkamp | 30.0 | -3.8 | 1.18 | 1,500 |
Weitz Hickory | 38.3 | -2.9 | 1.31 | 2,500 |
Specialty | ||||
Fund | 1yr. | 5yrs. | Expenses (as % of assets) | Minimum initial investment |
Cohen & Steers Realty Shares | 41.9 | 1.7 | 1.00 | 10,000 |
iShares Dow Jones Select Dividend Index ETF | 0.0 | N.A. | 0.00 | N.A. |
iShares S&P GSSI™ Natural Resources Index Fund of iShares Trust | 0.0 | N.A. | 0.00 | N.A. |
Third Avenue Real Estate Value | 50.8 | 1.2 | 1.12 | 10,000 |
T. Rowe Price New Era | 43.2 | 9.1 | 0.66 | 2,500 |
Vanguard REIT Index | N.A. | N.A. | 0.26 | 3,000 |
Vanguard REIT ETF | N.A. | N.A. | N.A. | N.A. |
Foreign | ||||
Large value | ||||
Fund | 1yr. | 5yrs. | Expenses (as % of assets) | Minimum initial investment |
Dodge & Cox International Stock | 53.3 | 6.1 | 0.64 | 2,500 |
Oakmark International I | 56.3 | 6.5 | 1.10 | 1,000 |
Large blend | ||||
Fund | 1yr. | 5yrs. | Expenses (as % of assets) | Minimum initial investment |
American Funds EuroPacific Gr A | 47.8 | 8.3 | 0.83 | 250 |
Fidelity Spartan International Index Inv | 37.5 | 4.2 | 0.10 | 10,000 |
Vanguard Europe Pacific ETF | N.A. | N.A. | N.A. | N.A. |
Vanguard FTSE All-World ex-US ETF | N.A. | N.A. | N.A. | N.A. |
Vanguard International Growth Inv | N.A. | N.A. | N.A. | 3,000 |
Vanguard Total Intl Stock Index | N.A. | 5.9 | 0.34 | 3,000 |
Large growth | ||||
Fund | 1yr. | 5yrs. | Expenses (as % of assets) | Minimum initial investment |
Artisan International Inv | 48.4 | 5.9 | 1.22 | 1,000 |
Small/mid value | ||||
Fund | 1yr. | 5yrs. | Expenses (as % of assets) | Minimum initial investment |
Third Avenue International Value | 42.2 | 4.1 | 1.48 | 10,000 |
Small/mid growth | ||||
Fund | 1yr. | 5yrs. | Expenses (as % of assets) | Minimum initial investment |
T. Rowe Price International Discovery | 62.3 | 8.9 | 1.24 | 2,500 |
Emerging Markets | ||||
Fund | 1yr. | 5yrs. | Expenses (as % of assets) | Minimum initial investment |
American Funds New World A | 58.8 | 12.6 | 1.01 | 250 |
T. Rowe Price Emerging Markets Stock | 96.6 | 14.6 | 1.24 | 2,500 |
Vanguard Emerging Mkts Stock Idx | N.A. | N.A. | 0.39 | 3,000 |
Vanguard Emerging Markets ETF | N.A. | N.A. | N.A. | N.A. |
Bond | ||||
Fund | 1yr. | 5yrs. | Expenses (as % of assets) | Minimum initial investment |
American Funds American Hi Inc Tr A | 50.7 | 4.6 | 0.70 | 250 |
Dodge & Cox Income | 23.3 | 5.6 | 0.43 | 2,500 |
FPA New Income | 4.1 | 4.0 | 0.61 | 1,500 |
Harbor Bond Instl | 19.0 | 6.7 | 0.60 | 1,000 |
iShares Barclays TIPS Bond Fund | 0.0 | N.A. | 0.00 | N.A. |
T. Rowe Price International Bond | 23.5 | 5.1 | 0.81 | 2,500 |
Vanguard Inflation-Protected Secs | N.A. | N.A. | 0.25 | 3,000 |
Vanguard Interm-Term Tx-Ex | N.A. | 4.2 | 0.20 | 3,000 |
Vanguard Short-Term Bond Index | N.A. | 4.8 | 0.22 | 3,000 |
Vanguard Short-Term Bond ETF | 0.0 | N.A. | N.A. | N.A. |
Vanguard Total Bond Market Index | N.A. | N.A. | 0.22 | 3,000 |
Vanguard Total Bond Market ETF | 0.0 | N.A. | N.A. | N.A. |
Target-retirement | ||||
T. Rowe Price Retirement | ||||
Fund | 1yr. | 5yrs. | Expenses (as % of assets) | Minimum initial investment |
T. Rowe Price Retirement 2005 | 26.9 | 4.3 | 0.60 | 2,500 |
T. Rowe Price Retirement 2020 | 36.2 | 3.5 | 0.73 | 2,500 |
Vangaurd Target Retirement | ||||
Fund | 1yr. | 5yrs. | Expenses (as % of assets) | Minimum initial investment |
Vanguard Target Retirement 2025 | 26.8 | 2.5 | 0.18 | 3,000 |
Vanguard Target Retirement 2035 | 29.5 | 2.2 | 0.18 | 3,000 |