FUND
To limit the number of funds in our tables, we’ve left out funds that are less than a year old and that require a minimum investment of $100,000 or more. The share class we choose is the biggest one that is open to new investors. We also exclude those that are sold only to special groups or institutional investors, or that are available only through IRAs.
TOTAL RETURN
Measures the change in value, assuming that dividend and capital-gains distributions were reinvested. Returns for three-, five- and ten-year periods are annualized—that is, stated on an average annual basis. Returns are for periods through December 31. A dash in a three, five- or ten-year column means the fund hasn’t existed that long.
CATEGORY
U.S. stock funds are described by the kinds of companies they invest in most heavily. Companies are divided into large (with a stock-market value in the largest 70% of stocks), small (the smallest 10%) and midsize (between large and small), and they are characterized as rapidly growing, undervalued or a blend of the two. Nine styles derive from these elements: LarGro, LarBlnd, LarVal, MidGro, MidBlnd, MidVal, SmlGro, SmlBlnd and SmlVal. Other styles: BearMkt (bear market), Financial, Health, Metals, Natrl Rsc (natural resources), Realty, Tech (technology), Utilities, LngShrt (long-short; funds that use short selling to limit losses), Misc (miscellaneous categories), Special (Merger fund and Arbitrage fund), and Hybrid, (balanced, convertible-bond and asset-allocation funds).
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International stock funds have substantial overseas holdings and are divided into eight categories: Divers (diversified) funds invest primarily in stocks of larger companies based outside of the U.S. DivSmMid (diversified small and midsize) funds concentrate on small and midsize foreign companies. DivEM (diversified emerging markets) funds invest in a variety of developing markets and RegEM (regional emerging markets) funds invest in developing markets of one area. Regional funds invest in one area and SngCntry (single country) funds invest in stocks of just one country. SgCtyEm funds invest in stocks of just one developing market country. Realty funds invest in foreign-based real estate companies. Global funds may invest in the U.S. as well as overseas.
Taxable and tax-free bond funds are described by the type of bonds they invest in most heavily. Bonds are divided into corporate, government and municipal, and classified by their average time until maturity. Short-term bonds will mature in less than three years, intermediate-term in three to ten years, and long-term in more than ten years. Nine styles emerge from these elements: ST Corp (short-term corporate), IT Corp (intermediate-term corporate), LT Corp (long-term corporate), ST Govt (short-term government), IT Govt (intermediate-term government), LT Govt (long-term government), ST Muni (short-term municipal), IT Muni (intermediate-term municipal) and LT Muni (long-term municipal). Other styles: BL (bank loan) funds invest in floating-rate loans made by banks to companies that typically carry below-investment-grade quality ratings. Currency funds may track foreign currencies or the performance of the U.S. dollar against other currencies. HY Corp (high-yield corporate) funds own mostly lower-grade bonds. Intl (international) funds have substantial assets in bonds from nations outside the U.S. Misc (miscellaneous) funds invest in a variety.
Exchange-traded funds are described by the style designations listed above and divided into Diversified U.S. Stock ETFs, International and Global ETFs, Sector ETFs, Bond and Currency ETFs, Inverse Market ETFs, Commodity ETFs and Alternative-Strategy and Miscellaneous ETFs.
DECILE RANK
Shows performance for each of the past five years, compared with other mutual funds using the same investment style. Funds are ranked 1 (top 10%) to 10. A decile rank of 5 or 6 is average. The decile ranking offers a quick gauge of how a fund performed compared with its peers.
DOWN MARKET
Shows performance between April 29 and October 3, 2011, the last down market for stocks. This year we’re showing how bond funds performed during the stock-market cataclysm rather than during a specific down period for bonds. We’re doing this for two reasons. First, we haven’t had a traditional bond bear market—one caused by rising interest rates—for years. Second, many investors are turning to bond funds for stability and want to know how they performed during this severe stock-market decline.
VOLATILITY RANK
Measures volatility among all stock and bond funds on a scale of 1 (least volatile) to 10. The higher the volatility, the greater the potential for gain or loss.
ASSETS
Shows the amount of money invested in the fund. If a fund has multiple share classes, we report the assets for all of the classes combined.
MANAGER SINCE
Shows how long the manager (or if there’s more than one, the lead manager) has been on board.
MINIMUM INVESTMENT
Tells how much it takes to open an account. For subsequent investments and for IRAs, the minimum is usually lower.
MAXIMUM LOAD
Tells you the highest sales fee for buying shares. A figure without a footnote means the commission is deducted from the money you send to the fund. A figure with an r is the maximum redemption fee charged when you sell shares. Funds that charge both sales and redemption fees have been footnoted with an s by the front-end load.
EXPENSE RATIO
Represents the percentage of a fund’s assets taken out annually to cover management fees and other expenses. Expenses are included in total-return numbers.
12-MONTH YIELD
Included with bond funds. To figure your taxable-equivalent yield on tax-free bond funds, divide the number in this column by 1 minus your income-tax bracket.
DURATION
Included in the table with bond funds only, a bond’s duration rolls bond yield, coupon, final maturity and other features into one number that’s expressed in years. The higher the number, the more volatile a bond’s price when interest rates change.
