Guess How Many Allocation Funds Have Positive Performance YTD? Hint: Not Many by Eric Bush, CFA, Gavekal Capital Blog
Even though the median stock in the US is flat YTD, 2015 has been a tough year for allocation funds. There are 2015 mutual funds in the Aggressive Allocation, Moderate Allocation and World Allocation Morningstar categories. Out of those 2015 mutual funds, only 22 have delivered positive performance YTD as of the end of September. This means just 1% of allocation funds have positive performance in 2015. It’s a shockingly low number and its one that becomes more eye-opening with the help of a visual aid.
In the chart below, we show all 2015 mutual fund. YTD performance has ranged from -24.95% to 6.43%. The size of the bubble refers to the YTD return so the larger the bubble the better the return has been. Also, the color also refers to return as well. The darker the red the more negative the return has been. The darker the blue the more positive the return has been. Fortunately for many managers out there, there is still time to (hopefully) turn some of these red circles into blue.