With real fears of an impending global depression coupled with Mutual funds holding record low amounts of cash and all three Major Equity Indices ( The S&P 500, Nasdaq 100 and Dow Jones Industrial) closing below their 200 day moving average, now could be the time to add Bear Market mutual funds to your portfolio. These mutual funds, which are categorized as long-short, market neutral or Leveraged Short, offer a great way to buffer the volatility and losses that can occur during a bear market.
Below we will share with you 3 top rated Bear Market mutual Funds. Each has earned a Zacks #1 Rank (Strong Buy) as we expect the fund to outperform its peers in the future. To view the Zacks Rank and past performance of all international funds, then click here.
TFS Market Neutral Fund (TFSMX) is a market neutral fund that keeps a constant ratio of long and short stock positions. It primarily invests in small and mid-cap firms. This fund has held up well in 2010 returning -0.13% YTD vs -3.2% in the S&P 500.
This market neutral fund has a minimum initial investment of $5000 and an expense ratio of 2.49%.
Rydex Inverse S&P 500 Strategy INV (RYURX) The fund seeks to provide investment results that inversely correlate to the performance of the S&P 500 Index. Unlike a traditional index fund, the fund’s benchmark is to perform exactly opposite the S&P 500 index, and the fund does not own the securities included in the index. Instead, as its primary investment strategy, the fund invests to a significant extent in short sales of securities or futures contracts, and in options on securities, futures contracts and stock indices. This inverse fund has returned over 6% during the last three months.
The Fund Manager is Michael P Bynum and he has managed this inverse fund since 1994.
Old Mutual Analytic US Long/Short A (OADEX) may invest in long and short position of publicly traded securities. It mostly invests in mid to large cap stocks. It usually has 120% long exposure to stocks and 20% short exposure stocks in its portfolio holdings. The fund has a 15 year average annual return of 6.23%
The Long Short fund has a minimum initial investment of $2500 and an expense ratio of 1.53% and can be purchased without a load.
To view the Zacks Rank and past performance of all international funds, then click here.
About Zacks Mutual Fund Rank
By applying the Zacks Rank to mutual funds, investors can find funds that not only outpaced the market in the past but are also expected to outperform going forward. Learn more about the Zacks Mutual Fund Rank at http://www.zacks.com/funds/mutualfund/
