Strong Fund Returns in '09, Best Since '03, Lipper Says

As for 2010, he says, the Federal Reserve Board is likely to keep interest rates low, at least in the near term. “This easy-money approach has the potential of keeping the rally going, possibly to investors’ consternation later on,” adds Roseen.

In terms of the fourth quarter of 2009, October’s negative equity fund returns (down 2.91percent) were followed by positive performance in November (up 4.49 percent) and December (up 3.47 percent). “Some 98 percent and 95 percent, respectively, of all equity and mixed-asset funds posted plus-side returns, contributing to the third consecutive winning quarter for equity funds (positive 4.92 percent for Q4),” says Roseen.

For the three-month period ended December 3, the analyst shares, the dollar lost ground against the pound (down 0.72 percent) but rose versus the euro (up 1.65 percent) and the yen (up 3.27 percent).

Commodity prices improved also, with near-crude oil prices expanding 12.39 percent to close the quarter at $79.36 a barrel and gold adding on 8.65 percent to end the quarter at $1,095.20 an ounce.

As for the first decade, the “aughts” of the second millennium (also referred to by some as the U.S.’s quasi-lost decade for equity investments), the average annualized 10-year returns range from 1.13 percent for U.S. diversified equity funds to 4.91 percent for sector equity funds. “It is fair to say, though, that the 10-year period ended December 31, 2009, was the worst in at least 50 years,” concedes Roseen.