Standard & Poor’s Equity Research has named names in its first-ever U.S. Mutual Fund Excellence Awards Program, and while the winners include big players such as Dreyfus and Vanguard, they also include smaller firms such as Jensen Investment Management and Mairs & Power.
For example, the top-winning gold domestic large-cap equity award went to Jensen Portfolio; J (JENSX), followed by a silver award for Becker Value Equity Fund (BVEFX) and a bronze award for Dreyfus Appreciation Fund (DGAGX). And among blended individual securities, the top gold award went to Vanguard Tax-Managed Balanced Fund; Investor (VTMFX), while the silver went to Mairs & Power Balanced Fund (MAPOX) and the bronze went to Vanguard Balanced Index Fund; Investor (VBINX).
Overall, winners were divided into 10 categories, ranked as gold, silver and bronze award recipients. S&P’s U.S. Mutual Fund Excellence Awards Program recipients were selected from an initial universe of 19,000 mutual funds. Those who won consistently achieved the highest overall quantitative ranking of five stars in their category using S&P’s proprietary, holdings-based research from Sept. 12, 2009 through Aug. 31, 2010.
In Sept. 2009, S&P Equity Research revamped its mutual fund ranking approach, which led to its award program, said S&P mutual fund analyst Todd Rosenbluth.
“Instead of just looking at past performance, which has been the industry standard, we decided to look under the hood to understand the expense ratio of the fund, to understand the quality of the fund’s holdings and to understand how
long management has been in place,” Rosenbluth said. “The funds that are recognized have been consistently top-ranked by S&P according to their performance track record, the quality of the holdings, and other risk and cost factors.”
S&P’s mutual funds awards program comes at a time when exchange traded funds (ETFs) are eclipsing them as a popular investment tool. However, Rosenbluth asserted, mutual funds remain extremely important to U.S. investors.