Lewis From what source are you culling these facts? Thx.
Of 2,258 diversified U.S. equity funds, only 111 have 10% or more in cash—and their recent performance has been poor. Just 18% of those with five-year records have beaten their peers as of Feb. 10. Go back 15 years to include the 2008 crash, and the outperformance number jumps to 48%.
It's a customized search on Morningstar Direct.
You can do a similar search using M* premium, though my impression is that the M* Direct database is a bit larger than the "retail" database.
For "diversified U.S. equity funds", screen on
category = U.S. equity (all)Applying "
distinct portfolio only" here shows 2116 funds, a bit less than Lewis' 2,2
58.
Next, add the screen:
portfolio composition (%cash) ≥ 10%This gives 122 distinct funds (curiously more than Lewis's 111, though off a smaller base).
Next, add the screen:
trailing returns (5 year) not equal to "not available"This eliminates funds without five year records, and leaves 88 funds.
To see many beat their peers' average, add:
trailing returns (5 year) > category averageThere are 29 such funds (33%).
Alternatively, one can see how many were above their peers' median, add:
trailing returns % (5 year percentile) < 50There are 22 such funds (2
5%). The ones that beat their category average but were below the median are: MARNX, HHDFX, LLSCX, SLCAX, STMSX, WEMMX, TORYX.
You can substitute 1
5 years for
5 years in the above screens and get:
52 funds with 1
5 year records, of which 26 (
50%) were above their peers' median, while 2
5 (48%) beat their peers' average.
RGFAX beat the midcap blend average, not the median, while ADGAX and AMCPX beat the large cap growth median but not the LCG average.
While playing around with these numbers can be fun, as Lewis described what's important is
why the funds hold so much cash.
