Top 5 Small Cap Mutual Funds (June 2011)

Mutual funds which invest in small-cap companies are the natural choice of investors with an appreciably higher appetite for risk and the willingness to take short term positions. Smaller companies reinvest a significant share of their earnings back into their business on a regular basis. This reassures stockholders of improved performance and higher profits. When markets are booming, small cap mutual funds see high levels of demand which leads to significant increases in their prices. Investors seeking greater diversification would do well by adding small cap flavor to their portfolios.

Below we will share with you 5 top rated small-cap mutual funds. Each has earned a Zacks #1 Rank (Strong Buy) as we expect these mutual funds to outperform their peers in the future.

Fidelity Series Small Cap Opportunities Fund (FSOPX) seeks capital growth. The majority of the fund’s assets are invested in small-cap companies. It seeks to acquire common stocks, both domestic and foreign, which may be growth or value stocks. The small-cap mutual fund returned 29.53% over the last one year period.

Richard Thompson is the fund manager has managed this small-cap mutual fund since 2009.

Waddell & Reed Small Cap A (UNSAX) invests at least 80% of its assets in domestic and foreign small-cap companies. The fund focuses on acquiring common stocks of companies which are new entrants, particularly those entering growing sectors. This small-cap mutual fund has a three year annualized return of 14.6%.

The small-cap mutual fund has a minimum initial investment of $500 and an expense ratio of 1.62% compared to a category average of 1.52%.

Eaton Vance Small-Cap A (ETEGX) seeks long-term growth by investing in small-cap companies. The fund focuses on acquiring common stocks of domestic companies with an emphasis on growth stocks. Companies chosen for investment must have market capitalizations identical to those included in the S&P SmallCap 600 Index. The small-cap mutual fund returned 24.94% over the last one year period.

As of December 2010, this small-cap mutual fund held 70 issues, with 2.27% of its total assets invested in Rosetta Resources, Inc.

Pacific Advisors Small Cap A (PASMX) invests heavily in stocks of small-cap companies with market capitalizations within $2 billion. A substantial share of its assets is used to purchase stocks issued by companies with market capitalizations below $500 billion. This small-cap mutual fund has a ten year annualized return of 11.53%.

George A. Henning is the fund manager has managed this small-cap mutual fund since 1993.

Pioneer Oak Ridge Small Cap Growth A (ORIGX) seeks long-term capital growth. It invests at least 80% of its assets in small-cap companies. It primarily invests in equity securities such as common stocks and convertible securities. The small-cap mutual fund returned 31.02% over the last one year period.

The small-cap mutual fund has a minimum initial investment of $1,000 and an expense ratio of 1.28% compared to a category average of 1.52%.

To view the Zacks Rank and past performance of all small-cap mutual funds, then click here.

About Zacks Mutual Fund Rank

By applying the Zacks Rank to mutual funds, investors can find funds that not only outpaced the market in the past but are also expected to outperform going forward. Learn more about the Zacks Mutual Fund Rank at http://www.zacks.com/funds/mutualfund.

About Zacks Investment Research 1767 Articles

Zacks Investment Research is one of the most highly regarded firms in the investment industry. In 1978 Zacks originated the concept of utilizing earnings estimates revisions to make profitable investment decisions. Zacks offers multiple investment products and services to help investors achieve superior returns.

Visit: Zacks.com

Be the first to comment

Leave a Reply

Your email address will not be published.


*