Funds & ETFs 830

These Funds & ETFs provide a variety of diversification ideas.

Fidelity International Capital Appreciation Fund (FIVFX) | Daily Alert June 3

Covid-19, and even more recently, political and economic uncertainty, have led to a sudden alteration to the international investment landscape. While we’ve changed only a handful of fund ratings this month, there can be elevated and difficult-to-quantify risks to venturing abroad with your money.

With that in mind, our models have only limited direct exposure to overseas stocks (most of it is the result of U.S. stock funds holding foreign domiciled companies).

In a perfect world we could steer investors to International Small Cap Opportunities (FSCOX). But as it’s closed to new investors, and as we’ve just downgraded its close cousin International Small Cap (FISMX) to OK to Sell from Hold, International Capital Appreciation remains our top choice. (It’s the only foreign stock fund we hold in our model portfolios.)

Jack Bowers, John M. Boyd and John Bonnanzio, Fidelity Monitor & Insight,, 800-397-3094, June 2020


First Trust Dow Jones Select MicroCap Index Fund (FDM) | Daily Alert June 10

Especially with microcaps, avoiding likely losers is crucial. That is the premise behind our top pick among microcap funds, the First Trust Dow Jones Select Microcap exchange-traded fund.

The fund screens for actively traded microcap stocks, then eliminates those with the worst earnings growth, profit margins, price/sales and price/earnings ratios, and six-month returns. The fund, which has outperformed the Russell Microcap Index over the last five and 10 years, ranks among the top 2% of small-value funds based on 10-year returns.

The fund, with an 0.60% expense ratio, mirrors an index designed by Horizon Investment Services, a sister company of Horizon Publishing. Horizon Investment Services is compensated
for creating the index.

Richard J. Moroney, CFA,, 800-233-5922, June 1, 2020


*SPDR Gold Shares (GLD)

Though the chart pattern could absolutely “break down” and tumble back to somewhere near the $135 range in a hurry, history also suggests that if it instead breaks out to the upside, it ought to make a sizable run for us. And, because “gold is gold,” I am comfortable adding a few more shares to both Portfolios as part of the “buy small lots on a regular basis” approach we have been taking with the precious metal for several years now (and, in fact, it is the only thing I am buying in the Aggressive Portfolio this month!). That being said, while “weakness will be bad,” you are encouraged to look at any strength that develops as a reason to buy, not sell. GLD is considered a buy under $172.

Nate Pile, Nate’s Notes,, 707-433-7903, June 2020


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