Three Top Foreign-Stock Funds That Have Struggled in 2013
Have these funds lost their luster?
Foreign large-cap funds encountered pretty favorable conditions overall in 2013. Granted, most of the world's emerging markets posted modest declines, and a few major ones, including Brazil and South Africa, suffered significant losses this year. Some developed markets, such as Canada and Australia, earned only modest gains. But the Japanese exchange, which is by far the largest in Asia and which makes up approximately 15% of the non-U.S. market capitalization, returned 26% for the year to date through Dec. 26. And European markets, which comprise nearly half of the equity universe outside the United States, gained 23% on average, led by the two biggest exchanges on the continent, France and Germany. All told, the typical foreign large-value fund returned 19% for the year to date through Dec. 26, while the typical foreign large-blend fund gained 18% and the average foreign large-growth fund returned 17%.
As would be expected, a number of topnotch foreign-stock funds thrived in this rather auspicious climate. For example, MFS International Value (MGIAX), which has a Morningstar Analyst Rating of Silver, gained 7 percentage points more than the foreign large-value norm, thanks to the strengths of its managers' picks in Japan and the United Kingdom, particularly the telecom powers KDDI (KDDIF) and Vodafone (VOD). And Silver-rated Oppenheimer International Growth (OIGAX) returned 6 percentage points more than the foreign large-growth average, as a plethora of manager George Evans' European holdings flourished, including the Netherlands' Aalberts Industries (AALBF) and Germany's United Internet (UTDI).
William Samuel Rocco does not own shares in any of the securities mentioned above. Find out about Morningstar’s editorial policies.