Smartphone Chips

Qualcomm has benefited as growing demand for smartphones lifts sales. The stock has gained 11 percent this year, trailing the 32 percent surge by the Philadelphia Semiconductor Index. Some investors have sold because of concern that revenue growth, which has averaged almost 30 percent each quarter this year, won’t translate into profit as the company faces more competition in emerging markets.

Members’ preference for low-cost ETFs, which are linked to indexes and trade like stocks, has increased because active fund managers usually don’t beat the market after fees over time, Sonnenfeldt said.

The SPDR S&P 500 ETF, known as the SPY, last year became the first ETF among members’ top five picks, ranking No. 2. The security tracks the U.S. benchmark index and is offered by Boston-based State Street Corp. New York-based BlackRock Inc.’s iShares MSCI EAFE ETF, which tracks equities in Europe, Australasia and the Far East, joined the list’s leaders for the first time this year.

ETF Deposits

U.S.-based ETFs attracted an estimated $33.6 billion in September, compared with $2.5 billion flowing into U.S. open-end mutual funds, according to Chicago-based researcher Morningstar Inc. ETFs charge an average 0.67 percent annual fee, compared with 1.26 percent for the typical mutual fund, Morningstar data show.

Tiger 21 also asked members their preferred asset class. About 41 percent chose public equities, followed by private equity and hedge funds, which both got 17 percent of the votes. Hedge-fund preference declined in the past two surveys while private equity gained favor.

The private-equity asset allocation is the highest in a decade, Sonnenfeldt said. The increase is driven more by direct investments members are making in closely held companies rather than commitments to private-equity funds, he said.

Chickasaw, Rachlin

Investors are losing money on an inflation-adjusted basis in safe assets such government bonds and cash, which is causing them to take more risks to preserve spending power, Sonnenfeldt said. They’re choosing investments they know, such as startups and small businesses, he said. Most Tiger 21 members have become wealthy by building a company rather than through an inheritance.