Small-cap funds are a good choice for investors seeking diversification across different sectors and companies. These funds invest in different small cap firms from various sectors, which diversifies the risk. Investors with a high risk appetite should invest in these funds. Furthermore, since these funds focus on small cap companies, they have a higher flexibility because of the quick decision making of these firms.
Below we will share with you 5 top rated small-cap mutual funds. Each has earned a Zacks #1 Rank (Strong Buy), so we expect these mutual funds to outperform their peers in the future. To view the Zacks Rank and past performance of all small-cap funds, investors can click here to see the complete list of funds.
Glenmede Small Cap Equity (GTCSX) seeks capital growth. The fund invests a large share of its assets in equity of undervalued small cap domestic companies. This small-cap mutual fund returned 30.73% over the last one year period.
The small-cap mutual fund has an expense ratio of 0.93%, compared to a category average of 1.31%.
Calvert Small Cap A (CCVAX) invests a large share of net assets in small companies having a maximum market cap of $3 billion. A maximum of 25% of assets can also be invested in foreign securities. This small-cap mutual fund returned 33.48% over the last one year period.
Natalie A. Trunow is the fund manager and has managed this small-cap mutual fund since 2010.
Invesco Small Cap Value A (VSCAX) seeks capital growth. The fund invests in small cap companies whose market cap is not more than the largest capitalized issuer listed in the Russell 2000 Index. A maximum of 25% of its assets are invested in securities issued by foreign companies. This small-cap mutual fund returned 33.81% over the last one year period.
As of June 2013, this small-cap mutual fund held 67 issues, with 3.55% of its total assets invested in Abercrombie & Fitch Company Class A.
Diamond Hill Small Cap A (DHSCX) invests the majority of its assets in companies having market cap below $2.5 billion and are attractively priced relative to their underlying value. This small-cap mutual fund returned 30.61% over the last one year period.
The small-cap mutual fund has a minimum initial investment $5,000 and an expense ratio of 1.31% compared to a category average of 1.39%.
Bridgeway Ultra-Small Company (BRUSX) seeks total return over the long term, focusing on capital growth. A majority of its net assets is invested in very small companies depending on the market cap. A maximum 15% investment may be parked in securities issued by a foreign company. This small-cap mutual fund returned 42.85% over the last one year period.
John Montgomery is the fund manager and he has managed this small-cap mutual fund since 1994.
To view the Zacks Rank and past performance of all small-cap mutual funds, investors can click here to see the complete list of funds.
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.
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