THE KIPLINGER 25 FUNDS Unflappable

Our flock of actively managed funds survived a wild year and as a group delivered benchmark-beating gains.

- NELLIE S. HUANG

A year ago, the last time we published our annual update of the Kiplinger 25, our favorite actively managed no-load funds, we were in the throes of a bear-market downturn—and still in the Kiplinger offices, debating whether to shut the doors and work virtually or keep calm and carry on. The market recovered (and then some), but we’re still hunkering at home.

As the world moves toward a new normal, it’s a good time to get one’s ducks in a row, so to speak. In many ways, the markets have simply come full circle. Just as before the pandemic began, stock and bond prices are high, yields are low, and the picture of a new economic and business cycle is beginning to come into focus.

But the past 12 months have been a wild ride, both for markets overall and for the Kip 25 funds. The period was marked by the end of the bear market and the beginning of a rocky, tech-driven recovery, punctuated by a shift toward small companies and economically sensitive sectors such as energy and financials after the election and the release of COVID-19 vaccines. All told, however, we’re happy with our funds. Our diversified U.S. stock funds, on average, beat the S&P 500 index; our foreign stock funds trounced the MSCI EAFE index of stocks in foreign developed countries; and our bond funds, overall, delivered bigger gains than the Bloomberg Barclays U.S. Aggregate Bond index. For a closer look at how our funds performed, see the box below.