HomeAfter a market crash like the one experienced from late 2007 to early 2009, it can be very difficult to regain confidence in the equities market. Many investors feel that they cannot trust money managers to keep their money working for them, and they begin to invest alone. The problem with this is that money managers are often catalysts for industries, and individual investors seldom catch onto an investment before the big money. This makes finding a strong, consistent mutual fund very important. Three of the strongest areas to place your money after an economic downturn are small caps, international and natural resources. These are often the hardest hit sectors in a crash, and as such are the first to rebound when things start to look better. There are several mutual funds that are poised to pop following this crash; here are some to consider putting your money into.
One of the top mutual funds for your consideration is the Baron Small Cap Fund, ticker symbol: BSCFX. This fund requires a minimum initial investment of $2,000, which is pretty standard for many mutual funds. This particular fund invests at least 80% of its assets in common stocks of small companies. The market cap of these companies is under $2.5 billion at the time that the assets are purchased. When selecting securities for this particular fund, there is a guideline that the manager of this fund uses, generally choosing stocks poised to gain 50% in the next two years. This may seem like a huge jump to expect in just two years, but small cap companies are generally strong buyout candidates. These small cap funds are generally one of the highest performing in a recovering economy, making small cap mutual funds like the Baron Small Cap Fund very wise investments.
When considering international funds, the Artio International Equity Fund is a good one to consider, ticker symbol: JETAX. International stocks are volatile, and can rise sharply when the economy begins to recover. This fund invests 80% of its assets in stocks of international companies, generally spread among 5 different countries. An added bonus to this fund is the near 3% dividend it pays to its holders. There is an initial investment minimum of $1,000 for this fund, giving many investors a chance to diversify their portfolio and prepare to take advantage of this turnaround in the global economy.
Possibly one of the best run mutual funds right now is the CGM Focus Fund, ticker symbol: CGMFX. Run by manager Ken Heebner, the CGM Focus Fund is a fund that allows its manager to make the calls on what the assets managed are, and when to sell them based on market conditions. As a result, there can be any number of international, natural resource, small, mid or large cap companies under this fund at any time. This gives the manager the ability to follow the market's direction should it change. For a minimum initial investment of $2,500, this fund can really be a valuable investment for years to come.
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