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What Sets These 6 Gold-Rated Large-Cap Funds Apart?

Any one of these funds would make a fine addition to a portfolio in need of exposure to value-oriented stocks.

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Alex Lucas: Investors who have become accustomed to large-cap value stocks on average trailing their growth counterparts over the past decade would do well to recall that these stocks dominated the early 2000s and could well come back into favor again. The large-value Morningstar Category currently has 333 actively managed, U.S. open-end mutual funds. Only six receive a Morningstar Analyst Rating of Gold, and all six are open to new investors. These six funds are American Funds Washington Mutual, American Funds American Mutual, Dodge & Cox Stock, MFS Value, Diamond Hill Large Cap, and AMG Yacktman. 

These six funds share certain attributes that support their Gold rating. Each has veteran management and has at least one manager who invests more than $1 million alongside shareholders. Five of the six face lower fee hurdles than similarly distributed peers. AMG Yacktman is an outlier in this respect. Its $100,000 minimum investment level places it in the competitive large-cap institutional peer fee group, and as result its 0.71% expense ratio ranks as average. 

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Alec Lucas does not own shares in any of the securities mentioned above. Find out about Morningstar’s editorial policies.