US small, large and international funds

Today at American Research and Management I looked at Morningstar reports in order to decide which funds would be better to invest into for the family. Morningstar reports rate mutual funds from one to five stars based on how well they've performed in comparison to similar funds. Within each Morningstar Category, the top 10% of funds receive five stars, the next 22.5% four stars, the middle 35% three stars, the next 22.5% two stars, and the bottom 10% receive one star. The funds are rated on time periods such as one; three, five, and 10 years and these ratings are combined to produce an overall rating. The ratings given are objective and based entirely on a mathematical evaluation of past performance, They are a useful tool for identifying funds so this is why it is a good resource for me to help gather information on which to base the Smiths investments on.

I produced a spreadsheet with Fixed income investments, US large company, US small company and International on a % total return of one month, three months, total return YTD, total return 12 months, % return 3 years and the expense ratio. I also incorporated the Standard and Poor’s 500 rating for comparing the US large cap total to show comparisons on market trends and rakings. For the US small Cap total I used the Russell 2000 and the international total I used the MSCI EAFE.

To gain access to Morningstar reports a membership is needed. Mr. Strand kindly gave me this admittance in order for me to study various funds in order to research, which would be suitable for the family. I have chosen for the US small company caps the following – Conestoga and Walthausen. This provides a 21.4% and 30.3% return over three years; this compared to the market trend of small cap at 25.9% is doing well in combination. The US large companies chosen were – Artisan Value fund investor shares, Edgewood Growth Instl and Jensen I. These funds provide an 18.5%, 15.7% and 16.5% return compared to the market average of 17.3%. For the International funds the ones chosen were the Thornburg international growth I, WHV international equity I and the Artisan International Value investor, which provide returns of 25.3%, 14.9% and 17.9% which compared to the market trend of 19.4% is doing well as a group.