Volatility persists in U.S. markets as inflation picked up in December and stronger-than-expected jobs data diminished expectations for future key interest rate cuts by the Federal Reserve.
Consumer prices increased 0.4% in December as prices rose for gas, eggs and used cars. On a yearly basis CPI rose 2.9% — the highest since July. After bottoming to a 3.5-year low of 2.4% in September, inflation increased for the third straight month in a row. Also, Trump’s market friendly policies like the reduction of corporate tax, deregulation and imposition of tariffs on foreign products are expected to boost economic growth but can also further spike inflation rates.
The nonfarm payrolls for the month of December soared by 256,00 against 212,00 in November and came above the Dow Jones forecast of 155,000 jobs. Also, the unemployment rate fell to 4.1% over the same period. Market participants are expecting no rate cuts in the Jan. 28-29 policy meeting, however, bets have increased for rate reduction in June.
Amid such market conditions, investors who wish to diversify into various asset classes but lack professional expertise in managing funds, especially in a volatile market, can consider these three mutual funds —Goldman Sachs Large Cap Growth Insights GMZPX, Goldman Sachs Focused Value GGYPX and Goldman Sachs Small-Cap Value Insights Fund GMAPX. These have not only preserved investors’ wealth but also generated excellent returns in the past.
These funds have the majority of their investments in sectors such as technology, finance, retail trade, energy, utilities and industrial cyclical, which help in long-term growth and preservation of wealth.
Founded in 1988, Goldman Sachs Asset Management (GSAM) is a world-renowned investment management company. GSAM provides portfolio management, design and advisory services to individual and institutional investors worldwide.
With over 2,000 employees, GSAM has 31 offices across the world to serve customers’ needs. The company has a team of more than 800 investment professionals who capitalize on Goldman Sachs’ technology, risk-management skills and market insights. The house provides individuals who wish to increase their wealth through various strategic investment funds.
GSAM offers investment solutions, including fixed income, money markets, public equity, commodities, hedge funds, private equity and real estate, through proprietary strategies, strategic partnerships and open architecture programs. The company’s strategies cover various asset classes, industries and geographies.
These funds boast a Zacks Mutual Fund Rank #1 (Strong Buy), have positive three-year and five-year annualized returns, minimum initial investments within $5000, and carry an expense ratio of less than 1%. Notably, mutual funds, in general, reduce transaction costs and diversify portfolios without an array of commission charges mostly associated with stock purchases (read more: Mutual Funds: Advantages, Disadvantages, and How They Make Investors Money).
Goldman Sachs Large Cap Growth Insights fund invests most of its assets, along with borrowings, if any, ina broadly diversified portfolio of large-cap domestic and foreign equity investments that are traded in the United States. GMZPX advisors may also invest in fixed-income securities.
Sharanya Srinivasan has been one of the lead managers of GMZPX since Feb. 29, 2024. Most of the fund’s exposure was in companies like Apple (13.1%), Microsoft (12.7%) and NVIDIA (10%) as of July 31, 2024.
GMZPX’s three-year and five-year annualized returns are almost 9.6% and 17.7%, respectively. GMZPX has an annual expense ratio of 0.53%.
To see how this fund performed compared to its category and other 1, 2, and 3 Ranked Mutual Funds, please click here.
Goldman Sachs Focused Value fund invests most of its assets, along with borrowings, if any, in a diversified portfolio of common stocks, preferred stocks and other instruments with equity characteristics. GGYPX advisors choose to invest in quality companies that are undervalued with competitive advantages over industry peers and have sustainable growth potential.
Charles Dane has been the lead manager of GGYPX since July 17, 2018. Most of the fund’s exposure was in companies like Exxon Mobil (6.1%), Danaher (5.3%) and AT&T (4.4%) as of Aug. 29, 2024.
GGYPX’s three-year and five-year annualized returns are almost 8.2% and 11.8%, respectively. GGYPX has an annual expense ratio of 0.68%.
Goldman Sachs Small-Cap Value Insights Fund invests most of its assets, along with borrowings, if any, in a diversified portfolio of equity securities in small-cap U.S. companies. GMAPX advisors also invest in foreign issues that are traded in the United States.
Joseph Kogan has been the lead manager of GMAPX since Feb. 29, 2024. Most of the fund’s exposure is in companies like Carpenter Technology (0.8%), M/I Homes (0.8%) and Federal Signal (0.8%) as of July 31, 2024.
GMAPX’s three-year and five-year annualized returns are almost 4.5% and 8.6%, respectively. GMAPX has an annual expense ratio of 0.83%.
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