A mutual fund is a pool of money which a licensed fund manager gathers from different investors to manage and invest in a wide range of assets, such as stocks, bonds, treasury bills and other securities for the benefits of the investors. For people, particularly retail investors, looking for assured way of growing their money, mutual funds often present a great choice
The United States mutual funds industry is the largest in the world with a total asset under management estimated at US$26.9 trillion in 2021. It industry is very significant in the country’s financial system. With approximately 8,000 funds available, mutual funds offers a wide range of investment options to both retail and institutional investors.
.In this blog post, I’ll show you the top 20 mutual funds in the US based on asset under management, expense ratio, and historic performance.
Now here’s my list of the top 20 mutual funds in the US market.
#1. Vanguard Total Stock Market Index Fund (VTSAX)
The Vanguard Total Stock Market Index Fund (VTSAX) is one of the largest mustua funds in the United States with Asset Under Management (AUM) of $1.2 trillion. The fund was created in 1992 and invests in the US stock market; offering broad exposure to large, mid, and small-cap equities. This fund has offered an annual return of 13.6 percent in the past 10 years, with an average expense ratio of 0.04 percent. This is one of the very lowest in the industry and a major reason it is popular amongst investors.
#2. Fidelity 500 Index Fund (FXAIX)
The Fidelity 500 Index Fund tracks and invest in the S&P500 index. Thus, for investors attracted to large cap stocks, the Fidelity 500 Index Fund (FXAIX) is a great option. It is one of the largest mutual funds in the United States with an asset under managemnent of $323 billion, expense ratio of 0.015 percent and a historical return of 14.5 percent per annum.
#3. Vanguard 500 Index Fund (VFIAX)
This is one the most popular index funds in the world and like FXAIX, it tracks the S&P 500 index. Vanguard 500 Index Fund has an asset under management of $573 billion, an expense ratio of 0.04 percent. It has a also offered a historic return of about 15.76% in the past five years.
#4. Vanguard Total Bond Market Index Fund (VBTLX)
The Vanguard Total Bond Market Index Fund (VBTLX) invest in corporate bonds and other investment grade fixed income securities. The fund also invests in US government bonds and tracks the Bloomberg Barclays U.S Aggregate Float Adjusted Statistics Index.
The fund has an AUM of $88.8 billion, expense ratio of 0.15% and has returned about 9% annually to investors.
#5. Vanguard Total International Stock Index Fund (VTIAX)
With an asset under management of $328 billion, VTIAX invests in the entire international stock market, providing exposure to both developed and emerging markets.
#6. Fidelity Total Market Index Fund (FSKAX)
This fund has an asset under management of $233 billion and invests in a diversified mix of US stocks. The fund has a low expense ratio of just 0.015%.
#7. Vanguard Total Stock Market ETF (VTI)
This exchange-traded fund has an asset under management of $221 billion and tracks the performance of the entire US stock market.
#8. Vanguard Wellington Fund (VWELX)
This fund has an asset under management of $118 billion and invests in a mix of stocks and bonds. The fund has a historic performance of over 8% per year for the past decade.
#9. Fidelity Contrafund (FCNTX)
With an asset under management of $138 billion, FCNTX invests in a mix of large-cap US stocks and has a historic performance of over 14% per year for the past decade.
#10. T. Rowe Price Blue Chip Growth Fund (TRBCX)
This fund has an asset under management of $48 billion and invests in large-cap growth stocks. The fund has a historic performance of over 17% per year for the past decade.
#11. American Funds Growth Fund of America (AGTHX)
With an asset under management of $234 billion, AGTHX invests in a mix of large-cap US stocks and has a historic performance of over 13% per year for the past decade.
#12. Vanguard Growth Index Fund (VIGAX)
This fund has an asset under management of $162 billion and invests in large-cap growth stocks. The fund has a low expense ratio of just 0.05%.
#13. Dodge & Cox Stock Fund (DOD)
Dodge & Crox Stock Fund (DOD) is a very selective and actively managed equity mutual fund that invests businesses that have long-term fundamentals relative to current valuations. The fund was established in 1965 and as at March 2003 has a diversified portfolio in about 72 companies with a total asset under management (AUM) of US$89 billion. The fund has returned an average of 10.22% in the past 20 years.
#14. T. Rowe Price Equity Income Fund (PRFDX)
With an asset under management of $28 billion, PRFDX invests in a mix of large-cap US stocks that pay dividends. The fund has a historic performance of over 11% per year for the past decade.
#15. Needham Agressive Growth Fund
This fund invests principally in the common stock of domestic issuers listed on nationally recognised exchanges; and seeks long term tax efficient returns. Over the past 10 years, the fund has returned 13.29%.
#16. Fidelity Sector All Equity Fund (FSAX)
This fund invests about 80% of its assets in large cap US stocks that are expected to grow at faster rate than average growth. The fund has a AUM of US$2.94 billion as of May 2023 with over 263 holdings.
#17. Vaguard Dividend Growth Fund (VDIGX)
VDIGX is an actively managed mutual fund that was launched in 1992. It focusses on high quality companies with the capacity to grow their dividend income over time. It is therefore suitable for investors with long term focus and interest in dividend income.
With an expense ratio of 0.27%, an asset under management (AUM) of US$53.2 billion, the fund records a historic 202% return in the past decade.
#18. Goldman Sacks International Equity ESG Fund (GSIFX)
This fund invests mostly in carefully evaluated diversified non-US equity investment that meet the fund manager’s environmental, social and governance (ESG) criteria. With an expense ratio of 1.1%, this fund has returned 6.6% in the past 10 years.
#19. Artrisan International Value Fund
This fund is managed by Artisan Partners, a globally recognised investment management firm and focusses on investing in international undervalued stocks. It seeks to offer its investors long term capital appreciation and income growth.
Thus, for investors who seek exposure to international market leveraging on an experienced investment manager, the Artisan International Value Fund, offers you the opportunity.
#20. Catalyst/MAP Global Balanced Fund
The Hussman Strategic Total Return Fund is a mutual fund managed by Hussman Funds, an investment management firm founded by Dr. John P. Hussman. The fund aims to achieve long-term total return with an emphasis on capital preservation.
The fund primarily invests in a diversified portfolio of U.S. stocks, bonds, and other securities.
In Conclusion
Investing in mutual funds offers a number of benefits: diversification, professional management, liquidity, variety and affordability. There are also challenges that confront investors when it comes to mutual funds. For example, there are fees to pay and expenses that may be incured. The investor doesn’t have control over his investment and you may also incure capital gains tax obligations. This are in addition to the fact that investing in mutual funds is still subject to market risks and fluctuations.
Again, in a market with thousands of mutual funds, it is normal that retail investors found it a daunting task in deciding which funds to invest in. In this regard, making use of services that offers mutual funds rankings will help in your research. Fortunatunately most investment firms and online news business news portals provide such information for free.
