Finding a Balance

The top-performing fund for all three periods is Hussman Strategic Total Return. The fund invests primarily in U.S. Treasury and government agency securities with the objective of long-term total return, and has the ability to take a limited exposure in foreign goverment bonds, utility stocks, and precious metals shares, and places added emphasis on defending capital during unfavorable market conditions. Sound like exactly what clients have been asking for? In the third quarter, the fund gained 0.67%. That might not sound like much until you keep in mind the S&P 500 index dropped 8.4% and the average diversified equity mutual fund lost 10.3% in that period. Dr. John Hussman, who has persistently argued for the last decade that stocks are overvalued, now believes they are undervalued, according to market commentary published at the end of October.

Berwyn Income is in the tables for one-year and three-year performance. It was basically flat in the third quarter (down 0.18%). For investors desiring a high level of current income while maintaining some potential for capital appreciation, Berwyn Income Fund invests the majority of its assets in bonds, though it may invest up to 30% of its assets in dividend paying common stocks. The fund’s balanced, income-oriented approach affords a greater level of price stability than an all equity portfolio.