Summer Heat Pumps Up US Equity Funds

August 23, 2002 (PLANSPONSOR.com) - Recent market rallies have pumped a little lifeblood back into the average stock fund, which still lagged the S&P 500 according to mutual fund tracking data.

According to Lipper, the average diversified US stock fund jumped 12.1% for the four weeks ended August 22, although that is less than the 14.8% gain for the broad Standard & Poor’s 500 index. But these funds still are down 16% year to date.

Diversified stock funds invest in an array of sectors, ranging from pharmaceutical stocks to financials to technology. They have about $1.96 trillion in combined assets, accounting for about three-quarters of all stock fund assets.

The biggest fund category, large-company core funds, gained 14.1% during the four weeks, Lipper said. These portfolios invest in all types of large-cap stocks.

The biggest recent gainers were battered telecommunications funds, which rose 16.6 % for the four weeks. But they still are down 41.5% year to date — the worst of any category.

The average world stock fund edged up 4.5% for the month. These funds are down 7.6% year to date, outperforming the average US stock fund.

–Fred Schneyer                            editors@plansponsor.com

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