When capital appreciation over the long term takes precedence over dividend payouts, growth funds become a natural choice for investors. These funds focus on realizing an appreciable amount of capital growth by investing in stocks of firms whose value is projected to rise over the long term. However, a relatively higher tolerance to risk and the willingness to park funds for the longer term are necessary when investing in these securities. This is because they may experience relatively more fluctuations than other fund classes.
Below we will share with you the 5 best performing growth mutual funds year to date.
|Mutual Fund||Zacks Rank||Total Return YTD|
|Delaware Pooled Select 20||#1 Strong Buy||9.6%|
|GMO US Growth III||#1 Strong Buy||8.1%|
|Sequoia||#1 Strong Buy||7.0%|
|Value Line||#1 Strong Buy||6.1%|
|GMO Quality III||#1 Strong Buy||5.3%|
Delaware Pooled Select 20 (DPCEX) seeks capital growth over the long term. The fund focuses on acquiring common stocks of firms with the ability to deliver superior growth at a pace exceeding that of the U.S. economy. The fund holds a portfolio of 15 to 25 equity securities. The growth mutual fund returned 33.46% over the last one year period.
Jeffrey S. Van Harte is the fund manager has managed this growth mutual fund since 2005.
GMO US Growth III (GMGWX) primarily invests in equity securities which are expected to provide returns exceeding that of the Russell 1000 Growth Index. The fund may utilize underlying funds and derivatives to invest in such equity securities. It allocates a large portion of its assets to investments with economic linkages to the U.S. The growth mutual fund has a three year annualized return of 5.67%.
The growth mutual fund has an expense ratio of 0.46% compared to a category average of 1.31%.
Sequoia (SEQUX) seeks capital appreciation over the long term. The fund primarily invests in common stocks of companies which have superior growth potential and are attractively priced at the time of purchase. It focuses on investing in domestic companies but may also purchase foreign securities. The growth mutual fund has a ten year annualized return of 5.71%.
As of June 2011, this growth mutual fund held 34 issues, with 13.41% of its total assets invested in Valeant Pharmaceuticals International Inc.
Value Line (VLIFX) invests the majority of its assets in common stocks. Securities to be acquired or sold are selected on the basis of the ranking of firms by the Value Line Timeliness Ranking System. The fund primarily invests in common stocks ranked within the first three categories on this ranking system. The growth mutual fund returned 30.5% over the last one year period.
Stephen E. Grant is the fund manager has managed this growth mutual fund since 2009.
GMO Quality III (GQETX) seeks total return. The fund primarily invests in equity securities which are of high quality. Not more than 20% of its assets are held as cash or invested in debt securities of high quality. The growth mutual fund has a five year annualized return of 2.8%.
The growth mutual fund has an expense ratio of 0.48% compared to a category average of 1.14%.
To view the Zacks Rank and past performance of all growth 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.