Mutual Funds
The 25 Best Mutual Funds
Yes, we know most of them stank the past year. But they're still the best bet to build wealth in the long run.
By Andrew Tanzer, Senior Associate Editor
From Kiplinger's Personal Finance magazine, May 2009
Advertisement
If you're like most investors, you're probably in a state of shock, paralyzed by fear. Stock markets everywhere have crashed. You may not even be looking at your deflated monthly account statements, unwilling to confront the real damage to your wealth caused by the most cataclysmic bear market since the Great Depression.
RELATED LINKS | |||
 |
Our 25 Favorites at a Glance | ||
|
|
Portfolios Using the Kiplinger 25 | ||
|
|
Tax Smart Investing | ||
|
|
PODCAST: How We Pick the Kiplinger 25 | ||
|
|
See the Kiplinger 25 on CNBC | ||
But you must continue to save and to invest for your long-term goals. There are no certainties in investing, only probabilities, which can work in funny ways. For example, the ten-year Treasury note is a proxy for the risk-free rate of return in investment theory. But Treasuries today offer only 2.8%. If you hold this "risk-free" Treasury for ten years, you are virtually certain to lose money after taxes and inflation take their remorseless toll on your money.
By contrast, stocks seem reasonably valued today for those investors who are able and brave enough to invest for the long run. There are also good values in bonds outside of the Treasury sector. The Kiplinger 25 is our list of the best no-load stock, bond and commodity funds to help you achieve your long-term investment goals. Keep in mind that no matter how highly we think of these funds, they are not miracle workers. As our table shows, all of our stock-fund picks, in particular, have taken a beating in the past year -- which has dragged down their long-term results as well.
See our picks, based on type of fund:
Large-Company Funds
Small- and Mid-Cap Funds
Overseas/Global Funds
Go-Anywhere Funds
Commodity Fund
Bond Funds
What's changed from the 2008 list
Get updated data on all the funds
View portfolios using the Kiplinger 25
Reader Comments (6)
Posted by: Bob at 04/13/2009 12:06:31 AM
It would be nice if Kiplinger would list all of these funds on a single page that is suitable for downloading.
Posted by: Rafael at 04/15/2009 12:56:12 AM
Why is the Dodge & Cox Stock fund listed on the top 25 funds and the model portfolios when it has performed so poorly compared to its index? Morningstar gives it a star rating of 3 for overall performance and a 2 for the 3-year period. I'm missing something? Please respond. Thanks
Posted by: Andrew Tanzer at 04/17/2009 01:15:09 PM
Hi, Rafael. This is the author of this article. To answer your question, Dodge & Cox Stock has been a good performer over the long term. It maintains investment discipline, continuity in management and a low fee structure. For much more on the fund, please see our extensive article in the February 2009 issue of the magazine at http://www.kiplinger.com/magazine/archives/2009/02/what-went-wrong-at-dodge-cox.html
Posted by: Doug from Kiplinger at 04/21/2009 05:39:23 PM
Bob, responding to your comment, we at Kiplinger.com have created a printer-friendly version of the Kiplinger 25, suitable for downloading. You can click on the Kiplinger 25 At A Glance link above, or cut and paste this url: http://www.kiplinger.com/investing/funds/kip25/tables/index.php in your browser. Hope this helps, and thanks for helping us make the Web site work better for you and other users.
Posted by: carol at 04/23/2009 09:27:54 AM
I would like to know what does Kiplingers consider the best insured government backed bonds to put your money into?
Posted by: Manny Schiffres at 04/24/2009 12:10:23 PM
Hi Carol. I'm Manny Schiffres. I supervise the investing coverage for Kiplinger's Personal Finance magazine. Both U.S. Treasury bonds and Ginnie Maes, mortgage securities insured by the Govt National Mortgage Association, are backed by the full faith and credit of the U.S. government. But that doesn't mean you can't lose money in them. Ginnies, Treasuries and any funds that invest in them are subject to interest-rate risk. If rates go up, the value of these bonds will go down. And since rates are so low, I would venture to guess that there's a lot greater risk of them rising than of them falling (which would result in higher prices for Treasuries and Ginnie Maes). For the time being, our favorite bond funds are the five included in the Kiplinger 25. Hope this helps. Please holler back if you have any other questions or comments.