#2 Worst Mutual Fund: Rydex Series Inverse S&P 500 Strategy Fund
YTD Return: -15%
The Rydex Series Inverse S&P 500 Strategy Fund (MUTF:RYURX) by Guggenheim is an inverse fund that aims to deliver the opposite daily performance of the S&P 500 Index.
Top 3 Holdings: N/A. This bear market fund’s strategy is to short sell equities to achieve the opposite performance of the S&P 500 index on a daily basis). RYURX uses derivatives like equity index swaps and futures contracts to bet against the S&P 500.
Manager(s): Michael Byrum is Rydex’s president and chief investment officer; he has been lead manager of RYURX since August 2001.
Takeaway: I’m a little concerned about inverse mutual funds like RYURX — particularly given FINRA’s jihad against inverse and leveraged exchange-traded funds recently. The regulator noted that inverse mutual funds could warrant a similar caution. “Funds such as these that are reset daily may present many of the same issues as leveraged and inverse ETFs, and should be subjected to a similar analysis,” FINRA said.
| Expense Ratio | Front Load | Deferred Sales Load | Min. Initial Investment | Assets Under Management |
| 1.41% | N/A | N/A | $2,500 | $167.4 million |
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