Where Are They Now? Mutual Funds Created at The Peak of the 2008 Financial Meltdown

You might think mutual funds born on the day one of the biggest financial meltdowns in history happened would be doomed from the start. But you’d be wrong. In fact, out of the four mutual funds opened on September 15, 2008, the day Lehman Brothers collapsed, three are currently B rated and one is a C-.

Mutual Funds Opened on September 15, 2008


Fund Name


Ticker
Total
Assets
(Mil$)

Investment
Rating
Dreyfus Global Real Estate Securities Fund Class C DGBCX 828.54 B
Dreyfus Large Cap Equity Fund Class C DEYCX 476.26 B
Dreyfus Large Cap Growth Fund Class C DGTCX 41.69 B
Matthews Asia Small Companies Fund Investor Class Shares MSMLX 552.75 C-

Looking deeper, out of the 1,398 mutual funds founded the year before the financial collapse, 687 are currently rated BUY, 633 – HOLD, and 78 are a SELL. From the 1,163 funds opened the year after the collapse, 511 are a BUY, 569 a HOLD, and 83 rated as a SELL.

So, as you can see, it doesn’t seem to matter when a mutual fund was started. For the most part they are performing reasonably, with many great choices in the “Buy” rated community.

So what goes into the Weiss ratings for mutual funds? Last week we showed you the two sub-ratings that go into our stock ratings. There are also two sub-ratings for mutual funds, but they’re slightly different:

Risk Rating – This is includes the risk ratings of component stocks, where applicable, and also includes the financial stability of the fund, turnover where applicable, together with the level of volatility as measured by the fund’s daily returns over a period of up to five years.

Funds with greater stability are considered less risky and receive a higher risk rating. Funds with greater volatility are considered riskier, and will receive a lower risk rating. In addition to considering the fund’s volatility, the risk rating also considers an assessment of the valuation and quality of a fund’s holdings.

Reward Rating – This is based on the total return over a period of up to five years, including net asset value and price growth. The total return figure is stated net of the expenses and fees charged by the fund.

Based on proprietary modeling the individual components of the risk and reward ratings are calculated and weighted and the final rating is generated.

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