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Mutual Fund Commentary

A single minded focus towards capital appreciation is what best characterizes growth funds. This purity of style is further established by the fact that investors can expect few or no dividend pay outs from such mutual funds. But investing in this class of funds requires a relatively higher appetite for risk than those following a value or blend style towards investing. However, in depth research and professional management are what make mutual funds a much safer proposition as compared to directly investing in growth stocks.

Below we will share with you 5 top rated growth mutual funds. Each has earned a Zacks #1 Rank (Strong Buy) as we expect these mutual funds to outperform their peers in the future. To view the Zacks Rank and past performance of all growth funds, investors can click here to see the complete list of funds.

PRIMECAP Odyssey Growth (POGRX - MF report) seeks capital growth over the long term. The fund invests the majority of its assets in domestic mid cap or large cap companies which have the potential to deliver growth which exceeds the average. A portion of its funds can also be invested in small cap companies. The growth mutual fund has a one year annualized return of 37.44%.

The growth mutual fund has a minimum initial investment of $2,000 and an expense ratio of 0.67% compared to a category average of 1.24%.

Needham Growth (NEEGX - MF report) invests a minimum of 65% of its assets in domestic companies listed on the Nasdaq or other nationally recognized securities exchange. The fund invests across different sectors. The growth mutual fund has a one year annualized return of 19.98%.

John Barr is the fund manager and he has managed this growth mutual fund since 2009.

Amana Growth (AMAGX - MF report) seeks capital growth on a long term basis. Investments are made based on Islamic principles. The fund invests the majority of its assets in common stocks. Companies having a track record of exceeding the economy’s growth rate are generally chosen for investments. The growth mutual fund has a one year annualized return of 14.95%.

The growth mutual fund has a minimum initial investment of $250 and an expense ratio of 1.13% compared to a category average of 1.24%.

MainStay Cornerstone Growth A (KLGAX - MF report) invests most of its assets in large cap companies which are listed on the Russell 1000A Growth Index. The fund primarily invests in companies with a minimum market cap of $3 billion. The growth mutual fund has a one year annualized return of 14.35%.

As of April 2013, this growth mutual fund held 51 issues, with 6.10% of its total assets invested in Google, Inc. Class A.

Timothy Plan Large/Mid Cap Growth A (TLGAX - MF report) seeks capital growth over the long term. Most of the fund’s assets are invested in domestic companies whose market cap is higher than $2 billion. Usually these companies have low dividend yields and high prices in comparison with earnings and book-value. The non-diversified growth mutual fund has a one year annualized return of 14.31%.

John A. Heffern is the fund manager and he has managed this growth mutual fund since 2007.

To view the Zacks Rank and past performance of all growth mutual funds, investors can click here to see the complete list of funds.

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.

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