Solutions that Revolve Around You Investments for Individuals
Home > Investments > Funds & Performance > Quarterly Fund Update
RiverSource 120/20 Contrarian Equity Fund
Second Quarter 2008 Fund Update
Portfolio Managers: Warren Spitz, Steve Schroll, Laton Spahr and Paul Stocking
Below, the portfolio management team discusses the Fund’s results and positioning for the second quarter of 2008.
- How did the Fund perform for the period?
-
RiverSource 120/20 Contrarian Equity Fund (the Fund) declined 4.04% (Class A shares, excluding sales charge) for the quarter period ended June 30, 2008, underperforming its benchmark, the Russell 3000® Index (Russell Index), which fell 1.69%.
Average annual total returns, which reflect Class A share performance at the maximum sales charge of 5.75% as of June 30, 2008, were since inception (10/18/2007): (25.45%). The Class A share total expense ratio for the Fund is 2.01%.
The performance information shown represents past performance and is not a guarantee of future results. The investment return and principal value of your investment will fluctuate so that your shares, when redeemed, may be worth more or less than their original cost. Current performance may be lower or higher than the performance information shown. To obtain performance information current to the most recent month-end click here.
- What factors most significantly affected Fund's performance?
-
The Fund’s position in the auto and transportation areas detracted most from performance, specifically holdings in Ford Motor Co. and a basket of airline companies, with economic and fuel-related pressures driving the negative performance. The Fund’s airline position has since been moderated. An underweight in the integrated oils industry also detracted, as did the Fund’s position in consumer discretionary, specifically National CineMedia, which provides in-theater advertising, and Regal Entertainment Group, which owns movie theaters around the world. An overweight in XL Capital, a global insurance, reinsurance and financial risk specialist, also detracted from performance.
The Fund’s best performing holdings for the quarter were in oil services, specifically Southwest Energy and Weatherford International. An underweight in financials and a short position in regional bank holding companies also added to relative performance.
The industrials sector was pretty much a wash, but Eaton, a leading diversified industrial manufacturer, stood out on the positive side.
Portfolio Holding (% of portfolio as of 6/30/08)
Eaton 3.61%
Ford Motor Co.
2.97%
Kohl’s
1.48%
National CineMedia
0.96%
Regal Entertainment Group
1.41%
Southwestern Energy
2.92%
Weatherford International
2.71%
XL Capital
0.84%
The views expressed above reflect the views of RiverSource Investments, LLC as of the date referenced. These views may change as market or other conditions change. This commentary is provided for information purposes only and is not intended to provide investment advice or account for individual investor circumstances. Past performance does not guarantee future results.
It is not possible to invest directly in an index.
Investment products, including shares of mutual funds, are not federally or FDIC-insured, are not deposits or obligations of, or guaranteed by any financial institutions, and involve risks including possible loss of principal and fluctuation in value.
Fund holdings are as of the date given, are subject to change at any time, and are not recommendations to buy or sell any security.
The RiverSource 120/20 Contrarian Equity Fund may make short sales, which involves selling a security the Fund does not own in anticipation that the security’s price will decline. The Fund’s potential losses could exceed those of other mutual funds which hold only long security positions if the value of the securities held long decreases and the value of the securities sold short increases. The Fund’s use of short sales in effect “leverages” the Fund, as the Fund intends to use the case proceeds from the short sales to invest in additional long securities. Leveraging potentially exposes the Fund to greater risks due to unanticipated market movements, which may magnify losses and increase volatility of returns. There is no assurance that a leveraging strategy will be successful. See the Fund’s prospectus for information on these and other risks associated with the Fund.
You should consider the investment objectives, risks, charges and expenses of a mutual fund carefully before investing. To learn more about this and other important information about the funds, download a free prospectus. Read the prospectus carefully before investing.
RiverSource® mutual funds are distributed by RiverSource Distributors, Inc., Member FINRA, and managed by RiverSource Investments, LLC. These companies are part of Ameriprise Financial, Inc.