prancingbull.com

Yesterday I stumbled across this website somehow or another. I’m not totally sure. Anyway, what I found was a very useful and informative site. Ever wonder what mutual fund companies own your particular stock. Better yet, what stocks does a particular mutual fund hold? At MFFAIS you can find that all out from their wealth of information.

Here is how it works:

You search the name or symbol of any stock or mutual fund that you want to look at. It doesn’t seem like this search option has been perfected yet, because I had some troubles finding a stock using the search tool. The best way to find what you are looking for is by starting letter. If you are looking at a stock, it will show you all the mutual funds that are currently invested or recently sold out. It also shows the number of shares that they own and what those shares are worth. You could also click on a mutual fund and it would show you all of the funds current holdings and recent sells. It then shows the number of shares in each company that fund holds.

You can also find out some interesting information on the site’s home page. For example, the top mutual fund class right now is the Global small/mid cap growth class. It also shows that Philip Morris was recently added to 230 different funds.

While I wouldn’t base my trading decisions on what this site says, it is interesting to see what the professionals are doing. If picking stocks is what they do every day for a living, I would think that their choices would likely be a bit better than mine. Just a guess. Although it is nice to see that some funds are doing worse than me this year. According to the site, the worst performing fund is Fursa Alternative Strategies LLC.

I recently went to the Fidelity home page and was welcomed by the news that they had created a new mutual fund. The name of the fund is the Fidelity Emerging Europe, Middle East and Africa (EMEA) Fund. The fund focuses on “the region of emerging economies from Russia through Eastern Europe and the Middle East and the entire African continent.”

Countries in the EMEA region could be seen to be highly risky because of the possibility of instability within the region. A major reason though that this area could potentially become profitable is because the “region is rich with natural resources which are in high demand in fast expanding economies. The region benefits from strong oil reserves, industrial metals, and precious metals.”

Countries in this region could potentially stand to have the largest percentage gains in their respective economies in comparson to the rest of the world. Traditionally, the EMEA region has “had low correlation to US and Developed (Europe, Australia and Far East) markets, as well as low inter-market correlation.”

As of 5/30/08 the fund had a NAV of $10.10 with an expense ratio of 1.42%. The average expense ratio for emerging market funds is 1.77%. This fund has been open since 5/8/09. To invest in this fund through Fidelity, one needs an initial deposit of $2500 and maintain a minimum balance of $2000. To find out more about this fund, click here. You can also find a quote for this fund from any financial website by using the symbol FEMEX.

The past few years there has been a lot of attention on the news about different ways to go green and make a difference in the environment. Even with all this focus on creating a greener way of life, large energy companies like ExxonMobil continue to make record profits. Something does not seem quite right here. As an environmentally conscious investor, one may focus the dilemma of choosing between a profitable company like ExxonMobil that will surely make them money, or searching high and low for some obscure environmentally friendly company. Once you do find that company, chances are they won’t even be profitable.

Portfolio 21 has taken the guesswork out of this for you. This investment company is based out of Portland, Oregon, which is the greenest city in the United States according to Popular Science Magazine. Simply put, Portfolio 21 only invests in companies that meet its stringent standards for being or working to become green companies.

The official strategy from their website reads, “Portfolio 21 invests in companies designing ecologically superior products, using renewable energy, and developing efficient production methods. Portfolio 21 companies seek to prosper in the 21st Century by recognizing environmental sustainability as a fundamental human challenge and a tremendous business opportunity.”

Besides looking for companies with strong balance sheets and income statements, Portfolio 21 also requires that companies have “ecologically superior product lines, . . . evolving product lines, investments in renewable energy, innovative transportation and distribution strategies, and efficient use of resources with respect to meeting human needs.” If a company starts to shy away from its green operations, Portfolio 21 will take action through what they call “Shareholder Activism.” Through this, they essentially file a complaint with the company to try to get them to return to their green ways. If this does not work, they will divest their funds. “If a company no longer meets our selection criteria, we divest. By divesting these companies we hope to send a clear signal to management regarding the importance of maintaining a focus on sustainable business strategies and improving performance in these areas on an ongoing basis.”

In the past year, Portfolio has rejected some very notable companies as investment opportunities based on their lack of greenness. Some companies of note are:

• UPS
• News Corp
• Royal Bank of Scotland
• Yahoo!
• Bank of America
• Texas Instruments
• Corning

As of 3/31/2008, the companies Top 5 holdings are

• Novartis (3.1%)
• Novo Nordisk (2.7%)
• Nokia (2.4%)
• Staples (2.3%)
• IBM (2%)

Some other noteworthy companies were Google, Siemens, Canon, HSBC Holdings, Intel, Nike, HP, Briston-Meyers Squibb, Dell, & Whole Foods.

The fund is currently trading at $34.34 under the symbol PORTX. If you invest directly through the company, the minimum investment is $5,000, or $1,000 if you choose to set up a retirement account. It is also offered through many brokers as well where the minimum may vary. As of 12/31/2008, the fund managed $266M allocated over 115 different positions. Its’ annual return has been 17.39% over the past 5 years. Another thing that I like about the fund is that the managers of it have been managing it since its’ inception.

If green investing is something that you would like to start doing, but lack the time or research capabilities to do it, a fund like this may be appropriate for you. As always, make sure to look over the entire funds past performance and investment objectives and always remember that past performance is never an indicator of future returns.

Over the past half year or so the Dow Jones Industrial average has been steadily falling. Typically when this happens most mutual funds tend to mirror this pattern. Investors who just like to stick their money in mutual funds instead hand picking stocks may be in for a bit of a fall as well. For those mutual fund only investors you may feel like you are stuck without many options to pull your portfolio out of this downward spiral. There are a few mutual fund options out there though.

One option that I have recently discovered are Bear Market funds. These funds specialize in shorting stocks that they feel are headed in a negative price direction. By shorting stocks, they are selling shares that they do not own in hopes of buying them back later at a lower price. Funds like these tend have a pattern that is inverse of the market as a whole.

My favorite pick out of these types of funds is the Prudent Bear (BEARX) fund. Of the 39 such funds that Fidelity offered, it was the only one that had a positive return over the last 10 years. That return was 3.62%. Not incredibly impressive, but considering that the market was working against it during the majority of that time period it isn’t anything to scoff about.

The official goal of this fund per the Fidelity website is: “The investment seeks capital appreciation. The fund seeks capital appreciation primarily through short sales of equity securities when overall market valuations are high and through long positions in equity securities when overall market valuations are low. It may hold more short equity positions than long equity positions when the dividend yield for the aggregate stock market is low relative to its historic range.”

Here are the vital return statistics:

As you can clearly see, when the market has been doing poorly, this fund has excelled. To further back up this claim, the beta of the fund as of 2/29/2008 was -.68.

The funds three largest holdings as of 12/31/2007 were: Cash offset for short futures, SPDRs, and Capstone Mining Corp. The fund’s top ten holding account for 38% of it’s total holdings.

Some negatives for the fund is that it has a decent amount of fees associated with it. Here is a rundown:

• Management Fee: 1.25%
• 12b-1 Fees: .25%
• Expense Ratio: 2.33%

These types of funds may not be the greatest long-term investment given the markets traditionally upward price movement. It can provide a nice hedge against pullbacks and mini-recessions like we may be currently be facing today. I would recommend this as a solid fund for the next six months to one year, but definitely not as a long-term investment.

Friday morning when I got to work I had an email from our Financial Analyst. Typically when I get an email from her it means that we have changed an important rate. This email said that we would be lowering our CD rates once again effective February 11th, 2008. All across the board we lowered them by 20 basis points (a basis point is 1/100th of a percent) with the exception of our 6 month CD which we keep at such a low rate that no rational investor would ever put money in them. Our rate for CDs over 6 months dropped from 4% to 3.8%.

This drop in savings rate shows our desire to stay consistent with a market that has seen the federal funds rate cut twice over the past month. Our rate cut can be seen as a blow to our members who may have CDs maturing soon. Over the past few months I have seen people coming in droves to cash out their matured CDs because they cannot afford to keep them in savings.

While this exodus of funds is not what we are striving for as a financial institution, you can’t really blame the customers for wanting to take their money out. At such low rates the money one makes in these low yielding CDs will barely keep up with inflation.

So what to do if you have a lot of money sitting in savings accounts right now? Well CDs and savings accounts are not really the place to be right now. You can do a bit better with some bonds, but not a whole lot. It is also hard to tell what direction the stock market is headed in right now, so that is probably not the best place to put your funds, especially if you are not one to take on risky investments.

Many mutual funds have been down this year, but here is a consistent performer that is not super risky. Its’ return for the year so far is -0.69%, but this isn’t bad compared to many funds that are at -12% for the year. The fund that I am suggesting is the Fidelity New Markets Income Fund (FNMIX). This fund avoids much of the risk of the stock market by investing in international bonds.

Here are the returns for this fund over certain periods of time:

Although this fund has been slightly down for the year, it can be seen that is has been a consistent performer over the years. If you are considering cashing out a money market or CD sometime soon, be sure to check this fund out before you commit to something else.

The minimum investment for this fund is $2500

This fund is currently trading at $14.49. I highly recommend this fund with a rating of 4.5/5, because of its investment in international bond funds. The fund eliminates the risk of the stock market, while earning higher returns, because foreign bonds currently have better returns than US bonds.

I currently do not own this mutual fund. For a list of my current investments, click here. To view a list of my current recommendations, click here.