Two happy surprises and two disappointments.
What a remarkable time to be an investor. First, you suffer through the worst bear market since the Great Depression, then you experience one of the best spurts ever. The rally--Standard & Poor's 500-stock index soared nearly 63% between March 9 and Nov. 19--has been strongest among some of the areas that were hardest hit in 2008. In the fund world, this translates into the worst-shall-be-first effect: Many of last year's weakest performers are among this year's best. And many of last year's winners are this year's dogs (see bear-market funds, for instance).
Some funds, however, managed to perform well (on a relative basis at least) both this year and last, and others were stinkers both years. Let's look at some of these surprises.
The managers of Brown Capital Management Small Company
Despite a torrent of correspondence questioning our intelligence and sanity (not to mention our morality), Morningstar kept Oakmark Select
And so far this year, Select gained almost 50% through Nov. 19 as its debt-heavy but still-sound holdings came roaring back. In recent years, Nygren and Berghoef have shifted into more-traditional growth companies because they seemed so cheap. Although this looked like a poor move at first, the managers have been vindicated. Despite the WaMu gaffe, Nygren's record since launching Select in 1996 is miles ahead of the S&P 500. He hasn't lost his touch, and we're pleased we didn't toss him and Select overboard.
Turning to the disappointments, one of the biggest has been Vanguard Asset Allocation
One problem is that the fund restricts its stock holdings to the S&P 500--not a good thing when big company stocks trail their smaller brethren. Moving 10% of the fund's assets from stocks to cash in the second quarter didn't help.
Bridgeway Aggressive Investors 2