Mutual Funds Go Topsy Turvy

Longtime losers--gold and Japan--are posting big numbers. And biotech looks sharp

For the second year in a row, the third quarter has turned out to be one ugly stretch for mutual fund investors. The Standard & Poor's 500-stock index peaked in mid-July and the Dow Jones industrials in August, and it has been downhill since. Bond prices have been sinking, as has the dollar. For the quarter through Sept. 27, the average U.S. diversified equity fund showed a negative total return: -5.58%, vs. -6.31% for the S&P 500. Equity funds as a whole fared a little better, falling just 3.69%.

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