(PUB) Morningstar FundInvestor

May 2 014

Morningstar FundInvestor

13

Dreyfus Appreciation Holding Up Nicely Leaders & Laggards | Dan Culloton

have helped propel the fund ahead of 98% of its peers so far in 2014 .

Laggards T. Rowe Price Media & Telecom PRMTX

There have been few places to hide in the communi- cation-services sector, which has been one of the worst areas of the market so far this year. It stands to reason that T. Rowe Price Media & Telecommu- nications would take it on the chin thus far in 2014 . This fund has done far worse than its peers, however, because of volatile Internet stocks, including online retail giant Amazon.com AMZN and Chinese web search portal Baidu BIDU . Together they account for 8 percent of the fund’s assets, and both have fallen by double digits this year. Dodge & Cox Stock DODGX Five years of generally rising stock markets and some bold stock picks have improved Dodge & Cox Stock’s intermediate-term trailing returns, but few will mistake it for a tame stock fund since the finan- cial crisis. Buying out-of-favor stocks and holding them when others lose their nerve has proved profit- able over the long term for the fund and its long- term shareholders, but market volatility can take its toll periodically on deep-value funds like this one. Recently tech picks, such as anti-virus software maker Symantec SYMC , and select financial picks, such as Goldman Sachs GS , have weighed on returns. Touchstone Sands Capital Select Growth PTSGX If Tech has singed Dodge & Cox, it has charred Touchstone Sands Capital Select Growth. The fund had rattled off several strong years in a row due in part to high-flying long-term holdings like Starbucks SBUX and Salesforce.com CRM . Those, and other large holdings like Amazon.com and LinkedIn LNKD , however, have given back some of the past years’ gains in recent months and sent this fund to the bottom of the large-growth category. The fund, which has more than a third of its assets in tech stocks, had lost more than 5% through April, but its long-term returns remained very strong. œ

Leaders Dreyfus Appreciation DGAGX

Ten Best-Performing Funds

Fund Name

YTD Cat Rank %

When the market lurches drunkenly, Dreyfus Appre- ciation’s sobriety pays off. The fund, which lagged its peers and benchmark in three of the past five calendar years, has walked a straighter line than rivals have in this year’s tipsy market; it has gone from the bottom to the top of the category. The portfolio’s focus on giant, wide-moat companies— nearly two thirds of assets—has helped. The fund’s energy and health-care sector picks, such as John- son & Johnson JNJ and EOG Resources EOG , also have been more resilient than the tech, telecom, and consumer cyclical firms this fund downplays. American Century Equity Income TWEIX American Century Equity Income is another fund that tends to look better the worse things get. It’s been fairly predictable in recent years, holding up relatively well in 2008 and 2011 while falling way behind in 2009 , 2012 , and 2013 . So, recent volatility has been good for this fund that emphasizes dividends and will keep 15% to 25% of its assets in convertible secu- rities. The fund’s income orientation has provided good ballast for this year’s choppy market. Like Dreyfus Appreciation, positions in energy and health-care stakes, such as Total TOT and Johnson & Johnson, provided a lift, as well. Royce Low-Priced Stock RYLPX Royce Low-Priced Stock also has reversed its fortunes so far this year. It finished each of the previous three years near the very bottom of the small-growth cate- gory as stakes in beleaguered mining companies acted like a collective ball and chain on relative and absolute returns. Many of those same holdings, such as Silver Standard Resources SSRI , have escaped their bonds this year and bolstered the fund’s relative results. Energy-related holdings, such as drilling data manager Pason Systems PSI , also

ClearBridge Aggressive Gr

1

FPA Perennial 1 Fairholme Focused Income 1 Matthews India Investor 1 Loomis Sayles Investment 2 Manning & Napier Equity 2 Royce Low Priced Stock Sv 2 Vanguard PRIMECAP Core In 2 Vanguard PRIMECAP Inv 2 Virtus Foreign Opportunit 2

Ten Worst-Performing Funds

Fund Name CGM Focus

YTD Cat Rank %

100 Scotia Dynamic U.S. Growt 100 T. Rowe Price Media & Tel 100 Vanguard Precious Metals 100 Baron Opportunity Retail 99 CGM Realty 99 Ariel Discovery Investor 98 Auxier Focus Inv 98 Third Avenue Internationa 98 Eaton Vance Floating Rate 97