Mutual Fund Rankings, 2008

Read our take on which of the one-, three-, five-, ten- and 20-year winners are worth buying now.

It was an ugly year for fund investors. Most stock funds bled red ink as share prices plunged because of worries that falling housing prices and a growing number of mortgage defaults would destabilize the nation's financial system. The collapse of Bear Stearns in March and growing fears over the summer that mortgage giants Fannie Mae and Freddie Mac might follow gave the bears plenty of ammunition. Adding to the gloom was the rise in fuel prices, which serve as a de facto tax on hard-pressed Americans and wreak havoc on industries such as airlines, autos and trucking.

The key to success over the past year was to hold funds that were stuffed with, well, stuff. Natural-resources funds soared an average of 35% over the past 12 months to July 1, while precious-metals funds did nearly as well (33%). Among diversified funds, Ken Heebner, manager of CGM Focus and CGM Mutual, kept up his remarkable performance of recent years by betting heavily on minerals and energy companies.

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Manuel Schiffres
Executive Editor, Kiplinger's Personal Finance