The Year in International Funds
A tumultuous conclusion to a challenging 2014.
One bright spot appeared on 2014's international scene: India. That market, which suffered through an alarming decline through most of 2013, began to revive once it became clear late that year that a new prime minister with a reformist agenda would likely take office in 2014. The rally has continued, with a few bumps, throughout this year. As a result, the India equity Morningstar Category has posted by far the biggest gain--nearly 40%--of the 16 Morningstar international-stock categories for the year to date through Dec. 19. (Moreover, that's the strongest showing of any Morningstar Category in any asset class.) The next-best international-stock group, Pacific/Asia ex-Japan stock, rose just 4.7%.
Most international funds, though, sit in one of the Morningstar Style Box categories, such as foreign large-value, rather than the country- or region-specific groups. And as they did in 2013, these style box categories lagged far behind their U.S.-focused counterparts. In fact, the best performer among the international-stock style box categories (foreign large growth) declined 3.1%, landing far behind the weakest U.S. stock-fund group (small growth), which rose 1.9%.
Gregg Wolper does not own shares in any of the securities mentioned above. Find out about Morningstar’s editorial policies.