Lipper Looks at Q4 Results

Equity funds may have had a “ho-hum” quarter in the last three months of 2014, but market conditions were anything but average, according to Tom Roseen, head of research services for Lipper. Equity funds ticked up 1.92% on average in Q4’14, Roseen explained during a recent webinar. Meanwhile, the price of oil fell 40.41%, gold dropped 2.33%, and the U.S. dollar rose 4.24% against the euro as well as 9.19% vs. the yen.

“There was increased volatility,” said Roseen. “But the icing on the cake [for upside performance] was the quantitative easing announced by China, Japan and Europe. At first, investors were excited, and then they maybe saw this as a sign of global slowing, which kept some [investors] at bay.”

Equity funds tracked by Lipper rose 1.68% in October and 1.02% in November, only to fall 0.93% in December.

Top, Bottom Performers

U.S. diversified equity funds improved 4.60% in Q4, while world equity funds declined 2.57% in the period. Some stand-out sector fund groups were real estate, up 13%; short, leveraged and other commodity strategies, up 10.75%; and health care, up 10%.

Commodity-energy funds dropped off 29.93%, as natural resource funds declined 18.01% and global natural resource funds fell 14.59%. Mixed-asset funds, including target-date products, improved 1.18% in Q4 and 4.33% for the full year.

“Equity investments were popular, and interest-seeking investments were popular, too,” explained Roseen. “People put money into small-cap funds, but large-cap funds were actually the long-term winner, as a vehicle for safety on the domestic side.”