Every fortnight, MutualFunds.com provides a snapshot of the performance of some key mutual funds and ETFs to highlight the trending sectors, geographic regions, and asset classes. MutualFunds.com uses a system to automatically scan through thousands of relevant securities and, to ensure quality and adequate track record, places a minimum threshold on net assets ($1 billion for mutual funds and $500 million for ETFs). The best and worst performers are further discussed in the report along with key economic highlights from the past fortnight, reminding you to adjust your portfolios, if required.

After weeks of rallies, markets posted mixed performances, with most asset classes heading down. The selloff was largely triggered by Federal Reserve Chair Jerome Powell’s clear signal that the bank is committed to bringing inflation down even if this will tilt the U.S. economy into recession.

US Broad mostly includes funds focused on US equities and can cover different investing styles (growth/value) and market capitalizations (small/mid/large). Fixed Income includes funds focused on debt securities and can cover different geographies (US/foreign) and security types (corporate/municipal/high-yield/investment-grade/government/structured). Alternatives cover funds focused on non-traditional investment strategies (currency, hedge fund strategy, derivatives), leveraged/structured products, real estate, and commodities. Dividend funds focus on generating income via equities and not through debt.

 

U.S. Broad

The majority of U.S. equities were down last fortnight, with growth funds posting the weakest performance.

 

Top Performers

 

• Mutual Funds: Kopernik Global All-Cap Fund (KGGIX) , down -0.16%, and American Funds Preservation Portfolio (PPFFX), down -0.41%.

• ETFs: Pacer Trendpilot™ US Large Cap ETF (PTLC) , up 0.07%, and Dimensional U.S. Targeted Value ETF (DFAT), down -3.5%.

 

Worst Performers

 

• Mutual Funds: Hartford Small Cap Growth HLS Fund (HISCX) , down -22.17%, and Hartford MidCap HLS Fund (HIMCX), down -21.31%.

• ETFs: Schwab U.S. Large-Cap Growth ETF™ (SCHG) , down -7.77%, and Fidelity® Nasdaq Composite Index® ETF (ONEQ), down -7.47%.

 

Dividend

In dividend funds, small-caps and high-growth dividends have been the worst performers in two weeks where no fund posted gains.

 

Worst Performers

 

• Mutual Funds: Hartford Dividend and Growth HLS Fund (HIADX) , down -14.7%, and Vanguard Diversified Equity Fund (VDEQX), down -6.22%.

• ETFs: WisdomTree U.S. SmallCap Dividend Fund (DES) , down -4.86%, and iShares Core Dividend Growth ETF (DGRO), down -4.76%.

 

Fixed Income

The picture was decidedly mixed in fixed income. Inflation-linked funds and funds shorting long-duration bonds have been among the best performers, while long-duration bonds have suffered.

 

Top Performers

 

• Mutual Funds: T. Rowe Price Dynamic Global Bond Fund (TRDZX) , up 1.98%, and Lord Abbett Inflation Focused Fund (LIFFX), up 0.83%.

• ETFs: ProShares UltraShort 20+ Year Treasury (TBT) , up 3.19%, and ProShares Short 20+ Year Treasury (TBF), up 1.72%.

 

Worst Performers

 

• Mutual Funds: PIMCO StocksPLUS® Long Duration Fund (PSLDX) , down -7.45%, and T. Rowe Price International Bond Fund (PAIBX), down -4.99%.

• ETFs: VanEck Vectors High Yield Muni ETF (HYD) , down -10%, and iShares International Treasury Bond ETF (IGOV), down -5.28%.

 

Sector

Energy stocks have recorded the best performance among all sectors, as Russia’s aggression in Ukraine and Saudi Arabia’s reluctance to raise oil output have led to strong gains. Meanwhile, several biotech and technology-focused funds suffered big losses.

 

Top Performers

 

• Mutual Funds: Fidelity® Select Energy Portfolio (FSENX) , up 8.17%, and Vanguard Energy Index Fund (VENAX), up 7.66%.

• ETFs: ProShares UltraPro Short QQQ (SQQQ) , up 25.14%, and Direxion Daily S&P Oil & Gas Exp. & Prod. Bull 2X Shares (GUSH), up 18.33%.

 

Worst Performers

 

• Mutual Funds: American Beacon ARK Transformational Innovation Fund (ADNYX) , down -17.22%, and Rydex NASDAQ-100® 2x Strategy Fund (RYVLX), down -15.3%.

• ETFs: Direxion Daily S&P Biotech Bull 3X Shares (LABU) , down -29.33%, and Direxion Daily Semiconductor Bull 3X Shares (SOXL), down -26.63%.

 

Foreign

China-focused funds have been the only gainers from the pack, while energy importers like Germany, Italy, and the Eurozone have posted the worst losses.

 

Top Performers

 

• Mutual Funds: PIMCO RAE Emerging Markets Fund (PEIFX) , down -0.11%, and Invesco Emerging Markets All Cap Fund (GTDFX), down -0.52%.

• ETFs: iShares MSCI China ETF (MCHI) , up 1.27%, and SPDR® S&P China ETF (GXC), up 0.87%.

 

Worst Performers

 

• Mutual Funds: Hartford International Opportunities HLS Fund (HIAOX) , down -22.83%, and Franklin International Growth Fund (FNGZX), down -9.66%.

• ETFs: iShares MSCI Germany ETF (EWG) , down -9.38%, and iShares MSCI Sweden ETF (EWD), down -8.74%.

 

Alternatives

After weeks of losses, funds with strategies based on volatility and managed futures posted positive performances last fortnight. Meanwhile, funds focused on commodities like gold and silver posted some of the biggest losses from this group.

 

Top Performers

 

• Mutual Funds: AQR Managed Futures Strategy Fund (AQMIX) , up 5.8%, and AlphaSimplex Managed Futures Strategy Fund (AMFAX), up 3.91%.

• ETFs: ProShares Ultra VIX Short-Term Futures ETF (UVXY) , up 16.84%, and iShares S&P GSCI Commodity-Indexed Trust (GSG), up 4.29%.

 

Worst Performers

 

• Mutual Funds: Fidelity® Select Gold Portfolio (FSAGX) , down -6.72%, and Janus Henderson Contrarian Fund (JCNCX), down -5.83%.

• ETFs: ProShares Ultra Silver (AGQ) , down -14.86%, and ETFMG Alternative Harvest ETF (MJ), down -7.91%.

 

ESG

ESG funds have all posted losses.

 

Worst Performers

 

• Mutual Funds: Brown Advisory Sustainable Growth Fund (BAFWX) , down -8.68%, and Vanguard FTSE Social Index Fund (VFTNX), down -6.64%.

• ETFs: iShares MSCI KLD 400 Social ETF (DSI) , down -6.45%, and Xtrackers MSCI USA ESG Leaders Equity ETF (USSG), down -6.27%.

Among major economic data released during the last two weeks, Federal Reserve Chair Jerome Powell said in a widely reported speech that the central bank will not stop raising interest rates until inflation falls to acceptable levels. Powell noted that the Fed’s actions might lead to some near-term pain for households and businesses.

U.S. retail sales growth was zero in July, after rising about 0.8% in June, in a further sign that a recession is near. U.S. unemployment claims have fallen in the past two reporting weeks, after slight gains in many previous weeks.

U.S. manufacturing purchasing managers’ index fell slightly but remained in positive territory. U.S. services PMI tumbled more than 3 points to 44.1.

German inflation is expected to rise 7.9% in August compared with 7.5% in the prior month, with energy and food prices increasing the most.

Eurozone manufacturing purchasing managers’ index fell further into negative territory, although only by a little and less than feared by analysts. Meanwhile, services PMI is barely above the 50 level, which indicates expansion.

Fund performance data is calculated for the period between August 17 and August 31.