Mutual Funds Analysis

According to the mutual funds scorecard published at year-end 2016 by SPIVA (S&P Dow Jones) 80% of “all domestic US funds” underperformed the relevant benchmark on a 3,5,10 years horizon. In Europe 79% of “Eurozone Equity funds“ were behind the index for the last 1,3,5,10 years.

Not surprising that the mutual funds industry continues to record redemptions to the benefit of ETFs ( US$ 600 Bn last year )

The experts say that this is due to the fees charged by active funds.

We strongly disagree. The dispersion of the performance across stocks is large enough to offer opportunities to beat the benchmarks and achieve consistent superior performance from smart active managers.

In 2017 the SP500 returned around 20%. But the top 20% performers gained on average 61% and the bottom 20% produced a negative -9%.  Performance dispersion is a recurring fact year after year – see our 20 years analysis for key markets:

Superior performance on a consistent basis comes from the ability to be in synchrony with major price trends.

Capturing a large part of bull trends and avoiding most of the bear trends in individual stocks and sectors over different market cycles is the essence of successful investing.

But in order to capture the positive trends and ideally some of the big winners, while avoiding a number of the losers one must understand and accept the fact that a robust, objective and disciplined trend analysis is required.

Fundamentals alone cannot effectively capture trends and the SPIVA statistics confirm this reality.

A simple overlay of “trend capture analysis” can be a precious complement to most investment strategies as it helps the fund manager to be more in synchrony with key trends on individual stocks and sectors.

Our “Trend Capture Rating“ provides a new metric to objectively measure the direction and quality of price trends. The rating (A,B,C,D) can be used to validate ideas and spot risks. OUR MODELS ARE DESIGNED TO SELF-ADJUST TO MARKET CONDITIONS AND USE ADAPTIVE TIME WINDOWS TO SPOT TRENDS SOONER THAN OTHER STATIC MODELS. The result is a faster identification of trends and reversals than the standard momentum models. This is why we call our solution “Smart Momentum “.

Below are examples that show how it is possible to maximize a fund’s performance by overlaying a simple “Trend Capture Analysis“.


AGTHX- Trend Capture Overlay

The Growth Fund of America Class A Shares(AGTHX)


AIVSX- Trend Capture Overlay

American Funds Investment Co of America A(AIVSX)


AMRMX- Trend Capture Overlay

American Mutual Fund Class A Shares (AMRMX)


ANCFX- Trend Capture Overlay

Fundamental Investors, Class A Shares (ANCFX)


ANEFX- Trend Capture Overlay

American Funds New Economy Fund A (ANEFX)


AWSHX- Trend Capture Overlay

Washington Mutual Invs Fd Cl A Shs (AWSHX)


DODGX- Trend Capture Overlay

Dodge and Cox Stock Fund (DODGX)


FCNTX- Trend Capture Overlay

Fidelity Contra Fund (FCNTX)


FMAGX- Trend Capture Overlay

Fidelity Magellan (FMAGX)


JLPSX- Trend Capture Overlay

JPMorgan US Large Cap Core Plus Fund (JLPSX)


JUEAX- Trend Capture Overlay

JPMorgan U.S. Equity Fund – A Share Class(JUEAX)


LCEAX- Trend Capture Overlay

Invesco Diversifed Dividend Funds Class A(LCEAX) – Trend Capture Overlay


MDDVX- Trend Capture Overlay

BlackRock Equity Dividend Fund (MDDVX) – Trend Capture Overlay


OAYMX- Trend Capture Overlay

Oakmark Fund Advisor Class (OAYMX) – Trend Capture Overlay


OIEIX- Trend Capture Overlay

JPMorgan Equity Income Fund A (OIEIX) – Trend Capture Overlay


PAFDX- Trend Capture Overlay

T. Rowe Price Equity Income Fd Advisor Cl(PAFDX) – Trend Capture Overlay


OTCYX – Trend Capture Overlay

Oppenheimer Capital Appreciation Fund (OTCYX) – Trend Capture Overlay


Templeton Global X USD – Trend Capture Overlay

Templeton Global X USD – Trend Capture Overlay


AATIX – Trend Capture Overlay

Ancora Small-Midcap Fund (AATIX) – Trend Capture Overlay


JLPSX – Trend Capture Overlay

JPMorgan US Large Cap Core Plus Fund (JLPSX) – Trend Capture Overlay


FDEIX – Trendrating Capture Overlay

Fidelity Advisor Capital Development Fund (FDEIX) – Trend Capture Overlay


HRCVX – Trendrating Capture Overlay

Carillon Eagle Growth and Income Fund (HRCVX) – Trend Capture Overlay


DNLRX- Trend Capture Overlay

Dreyfus Active Midcap Fund (DNLRX) – Trend Capture Overlay


CMVIX- Trend Capture Overlay

BlackRock Advantage Large Cap Growth Fund(CMVIX) – Trend Capture Overlay

This material is for professional investor use only:
This material is for informational and educational purposes only. It is not a recommendation of any specific investment product, strategy, or decision, and is not intended to suggest taking or refraining from any course of action. It is not intended to address the needs, circumstances, and objectives of any specific investor. The materials prepared by Trendrating may include data and other information provided by companies that are not affiliated with Trendrating (“Third Party Content”). While we believe the sources of the Third Party Content to be reliable we make no representations or warranties as to the Third Party Content and do not guarantee their accuracy, timeliness, completeness or usefulness. Back tested performance results for Third Party funds included in the materials will vary from official returns due to potential omission of historical holdings data and other factors, including investments cash flows, investment allocations, frequency and precision of rebalancing, tax-management strategies, cash balances, varying fees, and/or the timing of fee deductions. The returns represented in the materials are price returns computed on holding level data using close of day prices. As the result of these and potentially other variances, the actual NAV of the fund may differ from that of the back tested results.