Is this a good time to invest in a China fund?
Should you buy a Nasdaq Composite index fund or a Nasdaq 100 index fund?
What are some good funds for the conservative part of your portfolio?
FundX CEO Janet Brown answered these questions on the Money Life Show with Chuck Jaffe, and she shared FundX’s philosophy on investing in mutual funds and ETFs in 2020’s unpredictable markets.
“With periods of uncertainty with these wild swings in the markets, investors need a plan,” Janet explained.
“We’ve got an evidence-based approach that responds to changing markets. We’re investing based on what’s happening now rather than our guess on what the future’s going to bring….and we actively reposition our portfolios as markets change.”
Fund investing in 2020: What funds are in favor now?
Technology and large-cap growth funds are still the place to be, Janet said. But there are signs that market trends are starting to broaden and diversify a bit, she said, pointing to the strong recent returns of emerging market funds.
What other funds are doing well lately? Janet answered Money Life Show listener questions about China funds, index ETFs, bond funds, and total-return funds, plus she shared a few other funds that have been in favor recently.
FundX CEO Janet Brown’s take on four funds and ETFs
Talk to your advisor about which funds might be right for you.
1. Matthews China Small Companies (MCSMX)
This actively managed fund is a buy based on its recent performance, Janet said, but she cautioned investors about investing in such a concentrated fund. “This is an aggressive stock fund, and we personally would limit our positions in a fund like this,” she explained.
2. Fidelity Nasdaq Composite ETF (ONEQ)
“I personally like QQQ better, but if you want to stick with Fidelity funds, ONEQ is fine,” Janet said.
Invesco QQQ (QQQ) tracks the Nasdaq 100 Index, which includes the 100 largest stocks in the Nasdaq Composite Index. ONEQ includes nearly 1,000 stocks. You’ll find a more detailed breakdown of the differences between ONEQ and QQQ on ETF.com.
3. Vanguard Short Term Investment Grade Bond Fund (VFSTX)
“A very good fund for a very conservative portion of your portfolio,” Janet said. “If you want a little higher return, you could look at iShares Core Total US Bond (AGG) or even iShares Barclays 7-10 Year Treasury ETF (IEF).” These ETFs have had better recent returns with slightly more risk.
4. FPA Crescent (FPACX)
“This is a classic fund that I’ve used over the years. I would sell it now simply because among total-return funds, there are so many better funds,” Janet said, pointing to Value Line Capital Appreciation (VALIX) or Vanguard Balanced (VBALX).
FundX has positions in QQQ, AGG and IEF.
Click here to listen to the full interview.