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Stress-Testing Funds Through Two Bear Markets and Two Bull Markets

Looking at performance since 2000 creates a better picture of which funds have delivered for investors.

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The 2008–09 bear market made a bonfire of financials stocks, but all the other sectors were hit fairly hard, too. In contrast, the 2000–02 bear market crushed tech stocks, but other areas held up fairly well.

Let’s look at what those bear markets tell us about some fund managers. The 2000–02 bear market has fallen out of the standard trailing return figures now, so I thought, “Why not add it back in?” We now have two big bear markets and two ensuing rallies to measure when we go back to March 2000, and I was curious to see which funds look best when viewed through that broad lens.

Russel Kinnel has a position in the following securities mentioned above: VHCOX, OAKLX, JENSX, FAIRX. Find out about Morningstar’s editorial policies.