From Dustin Woodard,
Your Guide to Mutual Funds.
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Below are the top 10 mutual funds ranked by returns thus far in 2008. Each month the list will be updated to reflect the best mutual funds based on year-to-date return. At year end, we will crown the top mutual fund.

According to Morningstar data, the following funds had the best performance YTD in 2008 (through February 29th):

Best Mutual Funds of 2008:

1) Direxion NASDAQ-100 Bear 2.5X Inv DXQSX Up 51.2%

2) Rydex Inverse OTC 2x Strategy H RYVNX Up 40.0%

3) ProFunds UltraShort NASDAQ-100 Inv USPIX Up 39.9%

4) ProFunds UltraShort Japan Inv UKPIX Up 26.5%

5) Direxion S&P 500 Bear 2.5X Inv DXSSX Up 24.8%

6) PIMCO CommodityRealRet Strat Instl PCRIX Up 23.5%

7) Rydex Inverse Russell 2000 2x Strategy H RYIRX Up 22.1%

8) ProFunds UltraShort Small-Cap Inv UCPIX Up 21.3%

9) ProFunds UltraShort Intl Inv UXPIX Up 20.4%

10) ProFunds UltraBear Inv URPIX Up 19.9%

With the down market so far in 2008, it comes as no surprise that shorting funds, bear funds, and precious metals funds are leading the pack for the best funds of 2008.

This is quite a change from 2007, where China and leveraged bull funds dominated. I caution you not be lured in by attractive numbers that have already been realized (read "Chasing Investment Returns").