Growth funds are the natural choice for investors who prioritize capital growth over regular dividend income. This category of funds focus on returning capital growth by investing in stocks companies whose value is expected to rise over the long term. A relatively higher tolerance to risk and the willingness to park funds for the longer term are necessary when investing in these securities since they experience more fluctuations than other fund classes. However, compared to sector specific investments, like technology funds, the associated risk is much lower.
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, then click here.
Wells Fargo Advantage Growth (SGROX) invests in companies with the ability to grow revenues and earnings significantly. The majority of the fund’s assets are invested in equity securities. Not more than 25% of its assets may be used to purchase foreign securities. The growth mutual fund returned 34.54% in the last one year period.
The growth mutual fund has a minimum initial investment of $1,000 and an expense ratio of 1.07% compared to a category average of 1.31%.
RS Select Growth A (RSDGX - MF report) seeks capital growth by investing in small and mid-cap growth-oriented companies. It focuses on acquiring equity securities of companies whose market capitalizations may be at most 120% of the market cap of the largest company in the Russell 2500 Index. The growth mutual fund has a three year annualized return of 8.46%.
Stephen Bishop is the fund manager and he has managed this growth mutual fund since 2007.
ING Growth Opportunities A (NLCAX - MF report) invests a large proportion of its assets in domestic companies with the potential for superior growth. Not more than 15% of its assets may be utilized to purchase foreign securities. The growth mutual fund returned 25.78% over the last one year period.
As of June 2011, this growth mutual fund held 62 issues, with 5.64% of its total assets invested in Apple, Inc.
Value Line Premier Growth (VALSX - MF report) seeks capital appreciation over the long term. The fund invests the majority of its assets in a wide range of domestic equity securities issued by companies with the potential for superior growth. It is a no load fund.
The growth mutual fund has a ten year annualized return of 6.68%.
Delaware US Growth A (DUGAX - MF report) invests heavily in common stocks of companies with the ability to deliver long term capital growth. The majority of its assets are invested in domestic. securities. Not more than 20% of its assets are utilized to purchase bonds and other debt securities. The growth mutual fund returned 27.3% over the last one year period.
The growth mutual fund has a minimum initial investment of $2,500 and an expense ratio of 0.62% compared to a category average of 1.31%.
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.