Bearish sentiment has dominated among investors so far in 2022, with the Dow, the S&P 500 and the Nasdaq posting a negative return of 5.35%, 14.47% and 26.61%, respectively. Massive investors’ wealth has been eroded on account of various domestic and foreign factors.
Inflation in the United States has remained the key cause of stress for the government and average Americans. Though the consumer price index registered a 7.7% year-over-year increase for the month of October after record highs of 8.2% in September and 8.3% in August, indicating signs of cooling down, it is still far higher than the Fed’s target of 2%. The Fed continues with its hawkish stance in its effort to counter inflation. Such aggressive monetary policy tightening after a decade-long cheap borrowing rate is expected to negatively impact the economy and, in turn, the stock market. Many economists are predicting an impending recession in the near future. The global economy is also suffering due to a fresh COVID-19 crisis in China that has forced the authorities to impose restrictions, causing major supply-chain disruptions. Russia and Ukraine’s incessant war has also pushed up global energy prices due to the short supply in the markets. Though these events are unlikely to be resolved soon and have impacted the stock market, sectors like Oil & Gas and Energy have performed relatively well. From an investment standpoint, we have highlighted three mutual funds that have actually given commendable returns this year. Mutual funds, in general, reduce transaction costs and diversify portfolios without an array of commission charges that are mostly associated with stock purchases (read more: Mutual Funds: Advantages, Disadvantages, and How They Make Investors Money). These funds, by the way, have given impressive 3-year and 5-year returns as well, boast a Zacks Mutual Fund Rank #1 (Strong Buy), offer a minimum initial investment within $5,000, and carry a low expense ratio as compared to the category average. Fidelity Advisor Energy Fund ( FANIX Quick Quote FANIX - Free Report) invests most of its net assets in common stocks of domestic and foreign companies that are principally engaged in the energy field, including the conventional areas of oil, gas, electricity and coal, and newer sources of energy such as nuclear, geothermal, oil shale, and solar power. FANIX advisors choose to invest in stocks based on fundamental analysis factors such as financial condition, industry position, as well as market and economic conditions. Maurice FitzMaurice has been the lead manager of FANIX since Jan 1, 2020, and most of the fund’s holdings were in energy (86.34%), industrial cyclical (5.64%) and services (3.57%) as of Oct 31, 2022. FANIX’s year-to-date (YTD), 3-year and 5-year returns are 68.29%, 24.44% and 9.90%, respectively. The annual expense ratio of 0.77% is lower than the category average of 1.07%. FANIX has a Zacks Mutual Fund Rank #1. To see how this fund performed compared to its category, and other 1 and 2 Ranked Mutual Funds, . please click here BNY Mellon Natural Resources Fund ( DLDRX Quick Quote DLDRX - Free Report) invests most of its assets along with borrowings, if any, in stocks of companies in the natural resources and natural resources-related sectors irrespective of any market capitalization with growth and value characteristics. DLDRX advisors may choose to invest in issues of both domestic and foreign companies, including emerging markets. Albert Chu has been the lead manager of DLDRX since Oct 20, 2019, and most of the fund’s holdings were in industrial cyclical (38.46%), energy (38.06%) and non-durables (8.94%) as of Oct 31, 2022. DLDRX’s YTD, 3-year and 5-year returns are 36.16%, 29.36% and 15.46%, respectively. The annual expense ratio of 0.91% is almost in line with the category average of 1.11%. DLDRX has a Zacks Mutual Fund Rank #1. Forester Value Fund ( FVALX Quick Quote FVALX - Free Report) invests most of its net assets in large U.S companies with market capitalization greater than $5.0 billion. FVALX advisors generally invest in undervalued stocks that have great appreciation potential. Thomas H. Forester has been the lead manager of FVALX since Sep 10, 1999, and most of the fund’s holdings were in finance (12.02%), non-durables (10.92%) and utilities (8.07%) as of Oct 31, 2022. FVALX’s YTD, 3-year and 5-year returns are 12.01%, 4.94% and 2.77%, respectively. The annual expense ratio of 1.25% is lower than the category average of 1.92%. FVALX has a Zacks Mutual Fund Rank #1. Want key mutual fund info delivered straight to your inbox?
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