Aggressive Growth Mutual Funds & Average Return on Mutual Funds
Aggressive growth mutual funds are a type of mutual fund that invests in stocks of companies with high growth potential, regardless of their market capitalization. These funds are designed for investors who have a high risk tolerance and are willing to accept the potential for significant losses in exchange for the chance of achieving above-average returns.
Some of the characteristics of aggressive growth mutual funds include:
- High investment in small-cap and mid-cap stocks: These stocks are typically more volatile than large-cap stocks, but they also have the potential for higher growth.
- Focus on growth stocks: Growth stocks are stocks of companies that are expected to experience rapid growth in their earnings and revenues. These stocks can be more volatile than value stocks, but they also have the potential for higher returns.
- Limited investment in defensive assets: Aggressive growth funds typically hold a small percentage of their assets in cash or other defensive assets, such as bonds. This means that they are more likely to experience losses during market downturns.
If you are considering investing in an aggressive growth mutual fund, it is important to carefully consider your risk tolerance. These funds can be a good option for investors who have a long investment time horizon and can stomach the potential for significant losses. However, they are not a good option for investors who are risk-averse or who need their money in the near future.
Here are some examples of aggressive growth mutual funds:
- Fidelity Contrafund (FCGX)
- T. Rowe Price Growth Stock Fund (PRGSX)
- American Funds Growth Fund of America (AGTHX)
It is important to do your own research before investing in any mutual fund. You should carefully read the prospectus and consider the fund’s investment objectives, risks, and fees. You should also talk to a financial advisor to make sure that an aggressive growth mutual fund is right for you.
The average return on mutual funds can vary depending on several factors, including the specific type of fund, the time period being considered, and the overall market conditions. However, here’s a general overview:
Overall Average Returns:
- 1-year: As of December 21, 2023, the average one-year return for large-cap mutual funds in India stood at 16.15%.
- 5-year: The average 5-year return for mutual funds in India across various categories ranged from 7% to 12% as of December 31, 2023.
- 10-year: The average 10-year return for mutual funds in India ranged from 10% to 15% as of December 31, 2023.
Performance by Category:
- Large-cap: Large-cap funds, which invest in stocks of larger, established companies, tend to be less volatile than other types of funds and have historically delivered more consistent returns. The average 10-year return for large-cap funds in India was around 12% as of December 31, 2023.
Mid-cap: Mid-cap funds invest in stocks of medium-sized companies, which can offer higher growth potential than large-cap stocks but also come with greater risk. The average 10-year return for mid-cap funds in India was around 13% as of December 31, 2023.
Small-cap: Small-cap funds invest in stocks of smaller companies, which offer the highest potential for growth but also carry the highest risk. The average 10-year return for small-cap funds in India was around 15% as of December 31, 2023.
The average return on mutual funds can vary depending on several factors, including the specific type of fund, the time period being considered, and the overall market conditions. However, here’s a general overview:
Overall Average Returns:
- 1-year: As of December 21, 2023, the average one-year return for large-cap mutual funds in India stood at 16.15%.
- 5-year: The average 5-year return for mutual funds in India across various categories ranged from 7% to 12% as of December 31, 2023.
- 10-year: The average 10-year return for mutual funds in India ranged from 10% to 15% as of December 31, 2023.
Performance by Category:
- Large-cap: Large-cap funds, which invest in stocks of larger, established companies, tend to be less volatile than other types of funds and have historically delivered more consistent returns. The average 10-year return for large-cap funds in India was around 12% as of December 31, 2023.
- Mid-cap: Mid-cap funds invest in stocks of medium-sized companies, which can offer higher growth potential than large-cap stocks but also come with greater risk. The average 10-year return for mid-cap funds in India was around 13% as of December 31, 2023.
- Small-cap: Small-cap funds invest in stocks of smaller companies, which offer the highest potential for growth but also carry the highest risk. The average 10-year return for small-cap funds in India was around 15% as of December 31, 2023.
- Past performance is not necessarily indicative of future results.
- The average return is just that – an average. Individual mutual funds can and will outperform or underperform the average.
- It is important to choose mutual funds that are aligned with your investment goals and risk tolerance.