Tag Archives: zacks funds

5 China ETFs Up At Least 20% In Q4

Though the Chinese economy and securities have seen the height of volatility so far this year, the final quarter of 2015 seems quite steady, rather upbeat. This is quite a different picture from Q3 backed by compelling valuation after a bloodbath in August following currency devaluation and several cool economic data. China started to recoup losses from October with its A-Shares ETFs once again seeing runaway success in November. Apart from cheaper valuation, plenty of policy easing to jumpstart its ailing economy and hopes for further easing (as the economy is still reeling under pressure) helped Chinese equities ETFs to rule the top-performers’ list in the quarter-to-date frame (as of December 3, 2015). In October, China reduced the key interest rates by 25 bps, which marked the sixth slash since last November. Not only monetary policy easing, Beijing went on to enact a demographic reform and put an end to the country’s decades-long infamous one-child policy. Investors should note that China has long been working on stepping up domestic consumption, shedding focus on exports and intending to move to a ‘slower and more balanced growth’ economy. If this was not enough, the Chinese currency, the yuan, received a privileged reserve currency status from the IMF recently and joined the league of the major currencies, namely U.S. dollar, pound, euro and yen. China’s currency will have a weight of 10.92%, higher than the yen (8.33%) and the pound (8.09%), in IMF’s reserve currency basket from October 2016. As per the IMF, the step was the outcome of reformative measures presently being undertaken in China, which gives the “freely usable” tag to the yuan. It’s not that China investing is devoid of glitches. In fact, news about the Chinese securities regulators being stricter in their investigation into brokerages led the country’s stocks to suffer the deepest plunge on November 27 since the August uproar. Still, relentless constructive measures by regulators have saved China equities every time. One of China’s latest measures to calm the jittery market will be to launch a “circuit breaker ” on a benchmark stock index of the country next year. Per the new norm, a 5% one-day gain or loss in the CSI300 index (before 2:30 p.m.) would close trading in the country’s all equity indices for 30 minutes. Shifts of over 7% would result in closed trade for the rest of the day. In such a backdrop, investors might want to know about the top-performing China ETFs so far in Q4. For them, we highlight five Chinese equities ETFs that are still up at least 20%. KraneShares CSI China Internet ETF (NASDAQ: KWEB ) – Up 30.2% This product provides concentrated exposure to the Chinese Internet market by tracking the CSI China Overseas Internet Index. In total, the fund holds about 60 securities in its basket. The ETF has amassed $154.4 million in AUM and charges 71 bps in annual fees from investors. P owerShares Golden Dragon China Portfolio ETF (NYSEARCA: PGJ ) – Up 27.7% The $185 million ETF holds about 77 securities. The expense ratio of the fund is 0.70%. The fund is heavy on IT (46.4%) and Consumer Discretionary (38.2%). As far as individual holdings are concerned, Ctrip.com (NASDAQ: CTRP ) takes the top position with a 10.27% weight followed by NetEase (NASDAQ: NTES ) (9.8%) and Baidu (NASDAQ: BIDU ) (9.0%). Guggenheim China Technology ETF (NYSEARCA: CQQQ ) – Up 27.3% This fund targets the overall technology sector in China and follows the AlphaShares China Technology Index, holding 76 stocks in its basket. Alibaba dominates the fund’s return with a 21.5% share while other firms hold no more than 9.4% of assets. In terms of industrial exposure, about 65% of the portfolio is allotted to Internet mobile applications while electronic components and semiconductors round off to the next two spots. The product manages an asset base of $58.4 million. The expense ratio comes in at 0.71%. KraneShares CSI New China ETF (NYSEARCA: KFYP ) – Up 24.1% This fund tracks the CSI China Overseas Five-Year Plan Index, holding about 140 securities in its basket. About one-third of the portfolio is skewed towards Consumer Discretionary, closely followed by Information Technology. The fund is unpopular as depicted by its AUM of $3.2 million. The expense ratio comes in at 0.71%. Deutsche X-trackers Harvest CSI 500 China A-Shares Small Cap ETF (NYSEARCA: ASHS ) – Up 22.4% This product is a combination of China A-shares and smaller capitalization. This ETF attempts to replicate the performance of the CSI 500 index, which tracks 500 small cap companies on the Shanghai and Shenzhen stock exchanges. This $35.8 million fund charges 80bps in fees. Industrials (24.3%) and Consumer Discretionary (15.9%) are the top two sectors. Link to the original post on Zacks.com

Is Abenomics 2.0 Boosting Japan Mutual Funds?

In late September, Japanese Prime Minister Shinzo Abe had announced the second stage of his popular Abenomics plan. The “stage two” plan is aimed to resuscitate the Japanese economy. Among other things, the goal is to boost Japan’s gross domestic product by a significant 20% to $5 trillion by 2020. Following this, Japan Stock mutual funds have gained relatively well. In October, the sector gained 7.9% and in November Japan stock funds added 1.3%, which helped it to finish among the top gainers for the month. Morningstar data also shows that Japan Stock funds are leading one-month gains currently. Abe unveiled a new set of economic initiatives, which he dubbed as “Abenomics 2.0.” He promised to take Japan into a new era of prosperity. His proposals have, however, been met with both bouquets and brickbats. Some economists and market watchers have questioned the viability of the proposals. For instance, executives from leading business lobby termed Abe’s numerical targets as “outrageous” and “impossible.” During the first phase of Abenomics, Japan’s benchmark, Nikkei 225, had shown a significant uptrend. Though it is too early to predict whether the new targets are already having a positive impact, Nikkei 225 has gained 4.5% since Sept. 29. The focus once again shifts to Japan mutual funds, which were topping the charts earlier this year before stumbling in the third quarter. Japan’s economic situation is not as fragile as is widely believed. So, it’s not a bad idea to pick Japan mutual funds which are poised to benefit under existing conditions and will gain further as the economy continues to gather steam. Abenomics 2.0: The Three Arrows Abe outlined several new policy measures late last month, which he calls “Abenomics 2.0.” Abe spoke of new targets or his new “three arrows”: achieving a higher GDP over the next five years, providing support for child care and better social security. The last two are aimed at improving child rearing and care for the elderly for economically distressed families. Abe also aims to boost social security by offering care to the nearly 150,000 people who are slated to enter nursing homes. He also said that he would increase employment opportunities for the retired. Several prominent newspapers and economists have questioned where Abe will find the resources to fuel the last two initiatives. Has There Been A Positive Trend? Market watchers and economists have also pointed to the fact that several of Abe’s initial targets are still unfulfilled. Others question the efficacy of the first phase of Abenomics and have argued that only the monetary policy has proven to be effective. However, an assessment of the state of Japan’s economy by the Financial Times tells us a different story. The study has praised Abenomics’ record on improving corporate governance standards. The objective of these changes has been to increase return on equity and raise the number of independent directors. The ability to push through reforms in the agricultural sector has also been praised. Japan’s unemployment rate of 3.3% is much lower than several developed economies. Real monthly wages recorded their first yearly increase in July in more than two years. Additionally, the average wage increase for fiscal 2015 is 2.2%, the highest level achieved in 17 years. Japan Mutual Funds Japan Stock fund category had emerged as the best gainer in the first half of 2015. The market rout since then has dragged down major categories. However, Japan funds were less affected than its neighboring regions. Japan funds are up nearly 14% year to date, according to Morningstar. This is the best year-to-date gain so far among all fund categories. Banking on the optimism, investors interested in investing in Japan region may bet on the following three mutual funds. These funds carry either a carry a favorable Zacks Mutual Fund Ranks. The following funds carry either a Zacks Mutual Fund Rank #1 (Strong Buy) or Zacks Mutual Fund Rank #2 (Buy) as we expect the funds to outperform their peers in the future. Remember, the goal of the Zacks Mutual Fund Rank is to guide investors to identify potential winners and losers. Unlike most of the fund-rating systems, the Zacks Mutual Fund Rank is not just focused on past performance. The minimum initial investment is within $5,000. These funds are in the green over year to date and one-year periods. The three- and five-year annualized returns are also favorable. Fidelity Japan Smaller Companies Fund No Load (MUTF: FJSCX ) seeks capital appreciation over the long term. It invests most of its assets in Japanese securities or other instruments economically connected with Japan. FJSCX invests in securities of companies with market cap similar to those listed in Russell/Nomura Mid-Small Cap Index or the Japanese Association of Securities Dealers Automated Quotations (JASDAQ) Index. Fidelity Japan Smaller Companies currently carries a Zacks Mutual Fund Rank #1. FJSCX has gained 13.7% and 13.5% over year-to-date and one-year periods, respectively. The three- and five-year annualized returns are respectively 18.7% and 12%. Annual expense ratio of 1% is lower than the category average of 1.43%. T. Rowe Price Japan Fund No Load (MUTF: PRJPX ) invests a lion’s share of its assets in companies located in Japan. The fund invests in companies of all sizes and across Japanese industries. Managers use a bottom-up stock selection process while also being aware of industry outlooks. T. Rowe Price Japan currently carries a Zacks Mutual Fund Rank #1. PRJPX has gained 16% and 11.7% over year-to-date and one-year periods, respectively. The 3- and 5-year annualized returns are respectively 12.7% and 7.8%. Annual expense ratio of 1.05% is lower than the category average of 1.43%. Rydex Japan 2x Strategy Fund A (MUTF: RYJSX ) seeks to give returns that correspond to two times the performance of the fair value of the Nikkei 225 Stock Average. RYJSX invests in common stocks having market capital within the range of those listed in the index. RYJSX invests a lion’s share of its assets in securities that have the potential to return two times the performance of the underlying index. Rydex Japan 2x Strategy Fund Class A currently carries a Zacks Mutual Fund Rank #2. RYJSX has gained 20.3% and 11.8% over year-to-date and one-year periods, respectively. The three- and five-year annualized returns are respectively 20% and 6.8%. Annual expense ratio of 1.54% is lower than the category average of 2.03%. Original post

5 Strong Buy Vanguard Mutual Funds

Vanguard is one of the world’s largest asset management corporations that manage around $3 trillion in assets. It offers nearly 160 domestic funds and 120 funds for foreign markets (as of Dec. 31, 2014). It offers asset management and financial planning services to clients across the world. Unlike other mutual fund companies, Vanguard is owned by the funds themselves, which helps its management focus better on shareholder interests. Among other advantages, it claims to offer low-cost, no-load funds. Vanguard was founded by John C. Bogle in 1975. Below, we share with you 5 top-rated Vanguard mutual funds. Each has earned a Zacks Mutual Fund Rank #1 (Strong Buy), and we expect the fund to outperform its peers in the future. Vanguard Health Care Fund Inv (MUTF: VGHCX ) invests a major portion of its assets in securities of companies primarily involved in operations related to the healthcare domain. VGHCX invests in healthcare companies including pharmaceutical firms, medical supply companies and companies engaged in operations related to medical and biochemical. VGHCX may invest a maximum of half of its assets in companies located in foreign lands. The Vanguard Health Care Investor Fund has returned 10.3% in the year-to-date frame. Jean M. Hynes is the fund manager of VGHCX since 2008. Vanguard Morgan Growth Fund Investor (MUTF: VMRGX ) seeks capital appreciation over the long run. VMRGX uses multiple advisors to invest in domestic companies that are believed to provide above-average revenues and earnings growth. VMRGX invests in securities of companies having large and medium sized market capitalizations. The Vanguard Morgan Growth Investor Fund has returned 7.1% in the year-to-date frame. VMRGX has an expense ratio of 0.40% as compared to the category average of 1.19%. Vanguard Growth and Income Fund Inv (MUTF: VQNPX ) invests in a diversified group of stocks chosen with the help of quantitative analysis. VQNPX seeks stocks that are believed to provide dividend income and have impressive growth prospect and that, as a group, appear likely to provide higher returns than the Standard & Poor’s 500 Index while having similar risk characteristics. VQNPX invests a minimum of 65% of its assets in companies included in the index. The Vanguard Growth and Income Investor Fund has returned 2.2% in the year-to-date frame. As of September 2015, VQNPX held 786 issues with 3.33% of its assets invested in Apple, Inc. (NASDAQ: AAPL ). Vanguard New York Long-Term Tax-Exempt Fund Inv (MUTF: VNYTX ) seeks tax-exempted current income. VNYTX generally invests in municipal debt securities of New York state, local governments and other affiliates. VNYTX invests a lion’s share of its assets in securities that are expected to provide return free from federal and New York state taxes. VNYTX generally maintains a dollar-weighted average maturity between 10 and 25 years. The Vanguard New York Long-Term Tax-Exempt Investor is a non-diversified fund and has returned 3.2% in the year-to-date frame. VNYTX has an expense ratio of 0.20% as compared to the category average of 0.87%. Vanguard High-Yield Tax-Exempt Fund Inv (MUTF: VWAHX ) invests a large chunk of its assets in municipal securities that are rated investment grade by a nationally recognized statistical rating organization (NRSRO). However, a maximum of 20% of VWAHX’s assets may get invested in securities that are rated below investment grade. The Vanguard High-Yield Tax-Exempt Fund has returned 3.2% in the year-to-date frame. Mathew M. Kiselak is the fund manager of VWAHX since 2010. Original post