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3 Top-Ranked Small-Cap Growth Mutual Funds to Invest in

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Small-cap funds generally invest in companies having a market cap of less than $2 billion. The companies, smaller in size, offer growth potential, and their market capitalization may increase subsequently. Less international exposure makes small-cap funds less vulnerable to a stronger U.S. dollar.

Although small-cap stocks are believed to provide greater returns, they are expected to be more volatile than large and mid-cap companies. Also, growth funds may experience more fluctuations than other fund classes.

Risk-taking investors who prefer capital appreciation over dividend payout may consider small-cap growth mutual funds. Growth funds focus on realizing an appreciable amount of capital growth by investing in stocks projected to rise in value over the long term. Meanwhile, small-cap funds are good choices for investors seeking diversification across different sectors and companies.

Below, we share with you three small-cap growth mutual funds, namely Congress Small Cap Growth Fund (CSMVX - Free Report) , Vanguard Explorer Investor Shares (VEXPX - Free Report) and MassMutual Small Cap Growth Equity Fund (MSGNX - Free Report) . Each has earned a Zacks Mutual Fund Rank #1 (Strong Buy) and is expected to outperform its peers in the future. Investors can click here to see the complete list of funds.

Congress Small Cap Growth Fund seeks long-term capital growth by investing most of its assets, along with borrowings, if any, in common stocks of small-cap companiesacross all sectors of the economy. CSMVX advisors define small-cap companies with market capitalizations equivalent to the companies listed on the Russell 2000 Growth Index at the time of purchase.

Congress Small Cap Growth Fund has five-year annualized returns of 16.5%. As of the end of July 2024, CSMVX had 40 issues and 3.8% of its assets were invested in Sprouts Farmers Market.

Vanguard Explorer Fund Investor Shares fund aims for long-term capital appreciation by investing in small and medium-cap companies. VEXPX advisors choose to invest in companies based on superior growth potential.

Vanguard Explorer Fund Investor Shares fund has returned 11.2% in the past five years. VEXPX has an expense ratio of 0.45%.

MassMutual Small Cap Growth Equity Fund invests most of its assets, along with borrowings, if any, in common stocks of U.S. companies with market capitalization in the range of companies listed on the Russell 2000 Index or the S&P SmallCap 600 Index at the time of purchase. MSGNX advisors also invest a small portion of its assets in foreign issues, including emerging market economies.

MassMutual Small Cap Growth Equity Fund has five-year annualized returns of 10.6%.Daniel J. Fitzpatrick has been one of the fund managers of MSGNX since November 2021.

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

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