Elizabeth Ody, Kiplinger, on the Best Funds for Blue Chip Stocks

About mutual funds that are household names and should continue to perform well and -- dividends if any economy. This is the segment for you we're joined by Elizabeth Cody from kiplinger's magazine Elizabeth welcome to the show how aria. I'm fine how are you very thanks for having me. When I love the headline that's a great headlines. To -- household names perform well in any economy what kind of neutral funds are we talking. Yes that's that's the idea that so typically we're talking about mutual -- that event that won't we would call. Blue chip companies these are. The largest. Most established sort of household name companies that can kind of continued to sell their products continued -- grow their profit. Regardless that the economy though that this mostly mutual funds that hold generally large cap stocks would I would -- -- -- despite. Okay now the first when you light -- put on your list is the fidelity Contra. And that's managed by -- will -- off as I understand. That's right and you want them these are the biggest name managers with fidelity he's been at the there's several decades. And has executed really amazingly well. The fund has gained nine point 5% in July over the last ten years. And what they -- that they get that out that's fun is it it happens very large. Activate their 81 billion dollars invested in the fun and this started because of that -- -- asked -- to kind of lean toward the very large the largest at large companies that fund is actually the largest mutual fund shareholder. Apple Google and Berkshire Hathaway's. -- classes that you have a lot of really just alternate. Would you like from the end. I do it -- garden we like the dividend growth fund which is managed by at and Donald killed bride. -- a Wellington fund is that managed out of Boston. That's right that's right and children basically look for companies that he believes it will raise their dividends either because they are. Had about a strong X computer and -- continue to execute because maybe this is a stock that it sorted. -- now but he thinks is gonna kind of turnaround and be able to reap dividends the future. That won recently yielded two point 1%. That's up that right -- because you're getting some price appreciation there as well exactly. In the expenses were reasonable 31 basis points that's pretty low. About the yak and fun this has been a fun been good and bad -- like it. We weeping like at the long term record is very strong -- acumen fund it -- is up eleven point 6% over the last ten years. The more focused. Which means more concentrated it will secure never -- -- actually focus on the a little bit more. Would say I might tend to -- the action -- because the expenses are are a bit lower. But yet it had been a bit more of the volatile one I think it -- at the -- conviction. Sort of fund that basically. Donald Jackman looks for companies that do a really good job. Reinvesting their cash and earning money on the capital of their business sense of the capital that's been invested though. He -- companies like Pepsi and Procter & Gamble and I think if it could articulate pulled up a little wild it picked. How about -- I used to use them a lot back in the 1990s. As a mutual fund they have anything worthwhile. Yet we'd like that sent them quality growth by. Which is managed by it by if you -- managers. That they look for companies that have earned a return on equity. Of at least 15%. In each of the last ten years and so if you think about what that means what that's gonna narrowed and the election group down -- You're only going to be looking at companies that continue to do pretty well during 2008 and 2009. The right off the bat that kind of really -- your universe down two companies that. Can't execute even that started. The world the world really take. That's a good test isn't it. Yeah yeah. And then the last when I was hoping we can talk about was this bridge way blue chip 35 index this is a curious on what you like. -- you -- it shouldn't they want I mean one thing that I I'm a cheap ski when it comes to mutual fund Lila that it got a really low expense ratio. Point 15%. But it is it's an index fund that a little bit quirky. They basically try to hold the sort of large as 35 dock -- making some diversification adjustment they -- not all in like a few industries -- -- sectors. It's also a great fund board people who are concerned about. Tax efficient and that thing. Index fund in general had to be fairly tax efficient. But in this particular one the manager John Montgomery will actually started. Turn it just the way their. They're buying beat the index they track to avoid paying out. Capital gains that in fact in the -- sticking your history -- never distributed capital -- Well okay well -- thank you very much for your time I sure appreciate it. I don't think how much. That Elizabeth Cody from kiplinger's magazine and if you want more details such as the symbol. For those mutual funds you can -- goes written the article was written on August 2 it's typical -- -- magazine her last name is -- old DY. And on that website you and you can find. The symbols for all the different mutual funds Siemens it was two guys like that on satellite by ego you look it up -- perspectives and make decisions 21 purchase that -- for your -- re here your trust. Eight will be right back with our closing comments at a preview of two more show stay with us this is the financial exchange.