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5 Top Mutual Funds So Far in 2012

Hot categories include health care and emering-market debt

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MFS International New Discovery

Category: Foreign Small/Mid Growth
Fund Return for 2012: 18.81%
Category Return for 2012: 16.65%
Assets Under Management: $3.3 billion

Foreign equities have been a rough play this year thanks to the issues hampering Europe and Asia. Still, foreign small- and mid-cap companies have been able to grow, and thus have produced some nice winners.

Just look at MFS International New Discovery (MUTF:MIDCX). The fund has top notch portfolio managers — which include David Antonelli, Peter Fruzzetti, Jose Luis Garcia and Robert Lau — who scour the world looking for bargains, especially companies with strong moats and healthy cash flow prospects. The fund has a long-term approach, reflected in its low 44% turnover ratio.

MIDCX’s top holdings include Bunzl (U.K.), Amadeus IT Holding SA (Spain) and Swedish Match.

You can avoid an initial sales charge through Discovery’s C shares, but if you redeem your shares within the first year, you may be subject to a contingent deferred sales charge of 1%. Expenses are a hefty 2.17% on C shares, however. MIDCX requires a $1,000 minimum investment.

Tom Taulli runs the InvestorPlace blog IPOPlaybook, a site dedicated to the hottest news and rumors about initial public offerings. He also is the author of “All About Short Selling” and “All About Commodities.” Follow him on Twitter at @ttaulli. As of this writing, he did not hold a position in any of the aforementioned securities.

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