Kip 25

2 Great New Mutual Funds for the Kip 25

We turn to offerings from Primecap and T. Rowe Price to tweak our no-load lineup.

Less is more, as architect Ludwig Mies van der Rohe famously said. In that vein, we’re replacing only two funds in the Kiplinger 25 this year.

That compares with three or four in a typical year and is much less than the seven funds we swapped out a year ago.That compares with three or four in a typical year and is much less than the seven funds we swapped out a year ago.

Primecap Odyssey Growth (symbol POGRX) replaces Akre Focus (AKREX). We admire lead manager Chuck Akre, but his fund’s high annual fee of 1.34% has always bothered us. Odyssey Growth charges a below-average 0.66% per year. On top of that, it has an outstanding record. The fund invests in midsize and large companies that are expanding at above-average rates and trade at favorable share prices. Over the past decade, Odyssey Growth lagged Standard & Poor’s 500-stock index in just three calendar years (and one could argue that 2007 was a draw).

The fund has five managers: Theo Kolokotrones, Joel Fried, Alfred Mordecai, M. Mohsin Ansari and James Marchetti. Each has a chunk of his own money invested in the port­folio, and each one manages his own piece of the fund’s assets. They all look for a catalyst—the introduction of a new product, a restructuring or the arrival of new executives, for example—that they think will push a stock higher over the next three to five years. Health care and technology dominate the fund: Biotech firm Seattle Genetics, Eli Lilly and American Airlines are its top three holdings. Over the past year, the fund beat 98% of its peers (funds that invest in large, growing companies) and the S&P 500, with a 29.6% gain.

T. Rowe Price International Discovery (PRIDX) replaces Matthews Asian Growth & Income (MACSX). Asia remains promising, but we think a more diversified approach may better suit the Kiplinger 25 and our readers. So how about investing in a fund that bets on small firms around the world? Enter International Discovery, which holds about 250 small and midsize companies in developed nations (80% of assets) and emerging countries.

Most Popular

Tax Wrinkles for Work-at-Home Employees During COVID-19
taxes

Tax Wrinkles for Work-at-Home Employees During COVID-19

Are your home office expenses deductible? How does going out of state to work for a while affect your tax picture? There are some interesting wrinkles…
November 9, 2020
Retirement: It All Starts with a Budget
personal finance

Retirement: It All Starts with a Budget

When you’re meeting with your financial planner, do you talk about your budget? If not, you should.
November 10, 2020
Will Joe Biden Raise YOUR Taxes?
taxes

Will Joe Biden Raise YOUR Taxes?

During the campaign, Joe Biden promised that he would raise taxes for some people. Will you be one of them?
November 10, 2020

Recommended

10 of the Best Target-Date Fund Families
mutual funds

10 of the Best Target-Date Fund Families

The best target-date funds are a 'set it and forget it' approach to your retirement, but which fund family should you trust your money?
November 12, 2020
The Best Fidelity Funds for 401(k) Retirement Savers
Investing for Income

The Best Fidelity Funds for 401(k) Retirement Savers

Fidelity funds are renowned for their managers' stock-picking prowess. We rate Fidelity's best actively managed funds that are popular in 401(k) plans…
November 11, 2020
The Best Vanguard Funds for 401(k) Retirement Savers
mutual funds

The Best Vanguard Funds for 401(k) Retirement Savers

Vanguard funds account for a third of the 100 most popular 401(k) retirement products. We rank Vanguard's best actively managed funds, including its t…
November 11, 2020
The Best T. Rowe Price Funds for 401(k) Retirement Savers
Kiplinger's Investing Outlook

The Best T. Rowe Price Funds for 401(k) Retirement Savers

A dozen T. Rowe Price mutual funds also have a place among the nation's most popular 401(k) retirement products. Find out which funds belong in your r…
November 11, 2020