High-Yielding Mutual Funds
as of September 25, 2007

 




     All the funds listed below are no-load funds. I buy them free of charge through an Fidelity account. (Fidelity will allow you to buy a wide range of non-Fidelity funds without paying any transaction fees.)

  1.  The Matthews India Fund, MINDX, is on track to more than double in two years. (Of course, any fund that invests in a single country may be riskier than a broader-based regional or global index fund.)


  2.  The iPath Exchange-Traded India Fund, INP, is up about 39% so far this year.  What's significant about this is the way it's rocketing upward right now. way. This is an Exchange-Traded Fund (ETF), which means that it's an index fund for the entire Indian stock market that trades like a stock. The advantage to this is that you can buy  sell it during the trading day rather than having to wait until the market closes to make the purchase or sale. This can mean a lot of money if the stock market is moving up or down rapidly. Also, there are no restrictions on how often you can trade an ETF the way there are on mutual funds. The only disadvantages of which I'm aware are that you have to pay a brokerage fee when you buy and a brokerage fee when you sell (typically somewhere around $10 if you conduct your transaction online), and the value of the ETF isn't exactly the same as the value of its total stock portfolio (although in practice, these tend to differ only slightly). I'm now using ETF's whenever I can.


3.  The Janus Overseas Fund  JAOSX.  Like the Matthews India Fund, this fund has about doubled in two years, and is continuing to climb. 


4.  iShares Emerging Market Fund - EEM  This is a fund that indexes all of the emerging markets. It has less than doubled in two years, and has risen about 45% in one year.

Chart for EEM


5.  Profunds UltraEmerging Markets Fund  UUPIX  This fund attempts to double the performance of its  underlying emerging index. It's a good fund to buy at the bottom of a stock market pullback. It's probably best used with a stop-loss philosophy in which it's sold if it loses more than, viz., 5%-to-10%. It has slightly more than tripled from its low in June, 2006, to the present time. (I bought it during this last stock-market dip at $37.14 a share. As of 9/25/2007, it's up 47.17% to a new high at $54.66.)


6.  iShares Korea Fund  EWY  This South Korean index fund might be of interest because the South Korean stock market has allegedly been held back by strained relations with North Korea. Recently, however, relationships seem to have normalized with North Korea, and the South Korean market might be making up for lost time. (Of course, any fund that invests in a single country may be riskier than a broader-based regional or global index fund.)
Chart for EWY


7.  iShares Brazil Fund  EWZ 
Chart for EWZ


8.  iShares Hong Kong Fund  EWH  The mainland Chinese stock market is widely regarded, both inside China and outside it, as a bubble that my burst at any time. It sports an average P/E ration above 40:1. By contrast, as of a few weeks ago, the Hong Kong market had an average P/E ratio of about 18, even though some of the stocks listed on the Hong Kong exchange are much cheaper than the same stocks on the Chinese internal exchanges. The reason this could happen was because Chinese citizens couldn't invest their money in the Hong Kong stock market. However, in the middle of August, Chinese authorities decided to permit Chinese citizens to begin investing in Hong Kong stocks in an effort to bleed off some of the money that is pumping the mainland Chinese stock market to dangerous levels. It's estimated that within the next 18 months, $100 billion will flow from the mainland into the Hong Kong market. This transfer of funds hasn't started yet, and it's believed that when it does (in October?), the Chinese government will limit the rate at which this money can be transferred. However, the value of the EWH index has already been crept up 12.7% from its July high to its current level of $20.78, as shown in the chart below.

Chart for EWH


9.  The Fidelity Leveraged Stock Company Fund  FLVRX  This is an outstanding domestic fund. It has more than quadrupled over the past five years.


(To Be Continued)