Investors interested in high returns can choose mid-cap funds that bear lesser risk than small-cap funds. Mid-cap funds are not susceptible to gyrations in the broader market. This makes these funds ideal bets given the erratic macroeconomic conditions in recent years.
Also, when capital appreciation over the long term takes precedence over dividend payouts, growth funds are natural choices 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 while investing in these securities. This is because these may experience relatively more fluctuations than the other fund classes.
Below we share with you three top-ranked mid-cap growth mutual funds. 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 mid-cap growth funds.
Delaware Smid Cap Growth A (DFCIX - Free Report) seeks appreciation of capital for the long run. The fund invests mainly in growth-oriented, small- and mid-cap companies that the fund adviser expects to offer strong capital appreciation for the long run and is believed to grow at a better pace than the U.S. economy. Delaware Smid Cap Growth A has three-year annualized returns of 15.7%.
DFCIX has an expense ratio of 1.17% compared with the category average of 1.29%.
MassMutual Select Mid Cap Growth R4 (MEFFX - Free Report) seeks capital growth for the long run. MEFFX maintains a diverse portfolio by investing mainly in equity securities of mid-cap companies that are expected to have high growth potential in the long term. MassMutual Select Mid Cap Growth R4 has three-year annualized returns of 10%.
Brian W.H. Berghuis is one of the fund managers of MEFFX since 2000.
MFS Mid Cap Growth A (OTCAX - Free Report) seeks appreciation of capital. A large chunk of OTCAX’s assets is invested in companies having medium market capitalization. These companies have market cap identical to the ones listed on the Russell Midcap Growth Index over the last 13 months. MFS Mid Cap Growth A has three-year annualized returns of 11.7%.
As of September 2018, OTCAX held 105 issues with 3.12% of its assets invested in Bright Horizons Family Solutions Inc.
To view the Zacks Rank and past performance of all mid-cap growth mutual funds, investors can click here to see the complete list of funds.
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