Top 5 Growth Mutual Funds - Best of Funds

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 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.

Prudential Jennison Growth A (PJFAX) utilizes at least 65% of its assets to purchase equity securities issued by large and mid-cap companies. These firms must have market capitalizations greater than $1 billion and the potential for superior growth. The growth mutual fund returned 4.2% in the last one year period.

The growth mutual fund has a minimum initial investment of $2,500 and an expense ratio of 1.11% compared to a category average of 1.31%.

Wells Fargo Advantage Large Cap Growth (STRFX) seeks capital growth over the long term. The fund invests the majority of its assets in large cap companies and focuses on acquiring equity securities. Not more than 25% of its assets may be used to purchase foreign securities. The growth mutual fund has a three year annualized return of 5.3%.

Bruce Olson is the fund manager and he has managed this growth mutual fund since 2002

Needham Growth (NEEGX) invests heavily in domestic equity securities. The fund focuses on sectors such as technology, healthcare, media and business and consumer services. The growth mutual fund is non-diversified and has a ten year annualized return of 5.17%.

As of September 2011, this growth mutual fund held 67 issues, with 7.70% of its total assets invested in express Scripts.

Transamerica Focus A (IALAX) seeks long term capital appreciation. The fund invests in companies whose market cap lies within the bounds of the Russell 1000 Growth Index. A maximum of 25% of its assets may be utilized to purchase foreign securities. Not more than 10% of its assets may be invested in real estate investment trusts. The growth mutual fund returned 6.65% in the last one year period.

The growth mutual fund has a minimum initial investment of $1,000 and an expense ratio of 1.55% compared to a category average of 1.31%.

Delaware Pooled Large-Cap Growth Equity (DPLGX) invests heavily in large-cap companies. The fund selects companies which have the ability to grow their earnings significantly over the long term. It primarily purchases equity securities of large-cap companies which are included in the Russell 1000 Growth index. The growth mutual fund has a three year annualized return of 7.08%.

Jeffrey S. Van Harte is the fund manager and he has managed this growth mutual fund since 2005.

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.

View All Zacks #1 Ranked Mutual Funds
 
Zacks Investment Research

Read more at Zacks Investment Research