WEST PALM BEACH (HEDGECO.NET)- The US Stock market ended the year with an impressive gain of 25.3% surpassing expectations of the investment community. The NASDAQ market netted a spectacular gain of50% in 2003, while the S&P 500 index advanced by 26.4%.Small cap stocks which generally rise during the early stages of a bull market gained 37.5% for the year.
Such gains come as a surprise to industry watchers, following the mutual fund scandals and the resulting investigations announced by the New York State Attorney General Elliot Spitzer. Three other companies Bank One, Janus and Strong, were accused of allowing some hedge fund companies and other large financial institutions to �time� their trades so as to take undue advantage of market inefficiencies. Although timing strategies are not necessarily illegal, but initiating such trades after hours becomes problematic. Such scandals were unable to derail the gains in stock mutual funds however it shook the confidence of some market participants.
US stock funds did well during the 2003 session, according to data by Lipper Inc., the average US stock fund was in the positive column with a net gain of 33% for the year. US stock fund investors were happy to see a renewed growth in their fund portfolios, following the melt down of the past three years.
Commenting on the stock fund performance for 2003, James Oberweis Fund manager for the Oberweis Micro-Cap Fund said, “2003 was a good year because in 2002 people thought it would be a lousy year, now everybody thinks 2004 will be a good year, will it be a great year? Who knows?” The Oberweis Micro- Cap Fund was the best performing small cap fund for the year, with an impressive gain of 112% through Dec 30, 2003. International funds had a robust year as well with an average return of 38.9 for the year. Attention is now focused on 2004, while fund manager Oberweis did not want to speculate on what kind of year 2004 would be for the markets, he however disclosed that he is loading up his stock fund positions with technology and health care stocks.
Source: Paul Oranika
Editor-in-chief
Hedgeco.Net
