Money 911: This Month’s Best Investment Bets: Think High, Clean, and Green
By Martin Brown
Under an Obama presidential administration, you can bet that high tech and green technology will be booming. That said, put your money into funds (as opposed to individual stocks) that are built around companies that support these industries.
Clean Tech Funds
For example, in the first half of 2008, $2.2 billion was invested in clean technology businesses—already two-thirds of what it drew for all of last year. In the third quarter, already another $1 billion has been invested in some 73 clean tech companies. And solar and bio fuel companies are benefiting as well.
Kiplinger lists these two green funds as winners:
Neuberger Berman Socially Responsive (NBSRX)
This is the single best pick is probably single stock. According to Kiplinger’s: “The fund has beaten Standard & Poor’s 500-stock index in every year but one since Moretti took over. Over the past five years through May 15, the fund has returned an annualized 12% — an average of two percentage points per year ahead of the S&P 500.” The fund mainly owns stocks of large and midsize companies, and 22% of assets are in foreign stocks. Expenses are just 0.90% annually.
TIAA-CREF Social Choice Equity Retail (TICRX)
Says Kiplinger: “Relying on the KLD Broad Market Social Index for its list of acceptable companies, the fund seeks to replicate the performance of the broad-based Russell 3000 index. Over the past five years, the fund’s older Retirement Class shares (TRSCX) have trailed the benchmark by just 0.2 percentage point per year, on average. The Retail class’ annual expense ratio is just 0.21%…”
High Tech Funds
Morningstar touts these three high tech funds as the ones to watch:
Allianz RCM Global Technology Fund (RAGTX 30.16, +1.12, +3.9%)
With a 1.3 billion portfolio, this fund had been a steady performer throughout its 10-year lifespan.
The Global Technology Fund
holds about 80 stocks — most of them U.S. based — that Price and Chen trade frequently. The portfolio’s big winners so far this year include Red Hat Inc. Apple Computer, and SanDisk Corp. to name a few. MarketWatch.com writes: “Class A shares rose 7% so far this year, topping the S&P 500 by about 2 percentage points. Its three-year annualized 23% gain trounces the S&P benchmark’s 11% average return and lands the fund in the top 6% of its class.” Well said.
Fidelity Select Technology Fund
Besides a steady rise of 5.4% so far this year, the fund’s large tax-loss carryforward from the bear market, means that shareholders won’t be saddled with capital gains taxes for some time.