Home » The best mutual funds of the year. And who is in the red this year

The best mutual funds of the year. And who is in the red this year

by archyw

At the top of the list of the most powerful mutual funds for the first half of this year are funds from the area of ​​value stocks, such as financial and energy stocks. They built up a significant lead in the first quarter, while in the second quarter they mostly lagged slightly behind growth equity funds.

This follows from the Czech Investor Index CII750, which is compiled by Fincentrum & Swiss Life Select. The average Czech investor in mutual funds achieved an appreciation of 5.51% in January to June. However, the scissors between the individual types of funds have opened significantly.

“A dynamic Czech investor holding equity mutual funds in its portfolio achieves a higher appreciation. These brought him a profit of 11.34% in the past two quarters. On the contrary, a conservative investor faces worse performance when bond funds are de facto at the same starting level after six months, ”says Richard Bechník, chief analyst at Fincentrum & Swiss Life Select.

The development of exchange rates also had a significant effect. Against the US dollar, the Czech koruna was at the level of the beginning of the year in the first half of the year, but it strengthened significantly against the euro. Thus, mutual funds denominated in Czech crowns showed a higher growth rate in euro investments, Bechník adds.

The Czech Investor Index CII750 is compiled by Fincentrum & Swiss Life Select on the basis of 750 funds that are commonly available to the Czech investor. In calculating it, it monitors not only the returns of the funds, but also their weights in the total investment portfolio in the Czech Republic.

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Securities, mainly from Central Europe, achieved regionally decent results, which managed to reduce the spread of coronavirus infection together with an acceleration in the rate of vaccination. Within the stock markets, the value sectors dominate in the given area. The financial sector in particular benefited from the expected faster rise in interest rates than in most other regions.

Source: The index of the Czech investor CII750, Swiss Life Select and Thomson Reuters, is based on 31 December 2020

Commodity funds valued decently as part of the focus on other asset classes. Those oriented towards oil or copper, for example, were particularly successful. On the contrary, funds that derive their value from the price of gold underperformed.

How do the authors of the index see the third quarter? “What will be heard from central banks regarding the inflation and economic outlook will be decisive for the appreciation of funds. The continuation of strong economic growth accompanied by high dynamics of price level growth would bring back value funds back into the saddle. In the autumn, however, we may face the potential risk of another wave of coronavirus. On the contrary, the pessimistic scenario would thus support, for example, technology funds, defensive sectors such as public services, or safe bonds, ”says Bechník.

In general, according to him, a slower appreciation can be expected in the next months on the stock markets, but still significantly exceeding inflation. In the case of conservative investments, money market funds will benefit from their attractiveness, benefiting from rising interest rates, he adds.

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