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Transportation: This Top-Performing Industry May Surprise You
By: Investment U   Monday, September 28, 2009 12:06 PM

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Try this one out on your family and friends: ask them to name one of the top three best-performing industries of the past three months. You'll likely get an assortment of answers, but we bet major airlines won't feature in there too often.

But it's true. The industry comes in at #3 over the past three months, with carriers like AMR Corp (NYSE: AMR), UAL Corp (NYSE: UAUA) and US Airways (NYSE: LCC) all racking up huge gains.

This is a far cry from the airlines' "winter of discontent" in early 2009, as demand evaporated and credit froze up, extending the worst downturn in the industry's history.

But new research from Morningstar shows that even the most battered of industries can still produce gains for investors. The firm tracked 10 funds with the most exposure to "major airlines" and "regional airlines" – and the results speak for themselves.

In 2008 – a brutal year for the airline industry – just two funds notched returns that beat the category average. But over the past three months, all 10 have posted above-average gains, with eight even ranking in the top 10% on the back of airline stocks' resurgence. And for 2009 so far, eight have beaten their category average.

We're not saying it's time to jump into airline stocks now. But it does illustrate that going against conventional "wisdom" can often serve you well when investing. For more on how to develop this trait, check out this article.


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The above story is the opinion of the author only and it does not reflect iStockAnalyst opinion. Further, the author is not personally advising you regarding the suitability of the story for your investment needs. In no event iStockAnalyst will be liable for any loss or damage including without limitation, indirect or consequential loss or damage, or any loss or damage whatsoever arising from or arising out of, or in connection with the use of this information. Please consult your investment advisor before making any investment decision.
  
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