Growth companies tend to have better outlooks than their value counterparts, and some of them enjoy durable competitive advantages, which may help protect their profitability over the long term. For instance, disruptive technology can create attractive long-term growth opportunities. Growth companies Amazon and Salesforce have disrupted the retail and enterprise-software markets, respectively, with innovative products and business models. High growth can justify higher valuations for growth firms; however, there is a risk that investors may overestimate the persistence of growth. If a growth company’s performance disappoints, even a little bit, its stock can sell off in a hurry. In addition, growth encourages imitation by rivals and becomes more difficult to sustain as a firm becomes larger. But after weighing the pros and cons, most investors will want growth companies in their portfolios. Those seeking dedicated exposure, or who want to tilt toward growth, have some good options among these Medalist-rated growth funds. For this list, we also required that the fund’s underlying portfolios have at least a "narrow" Average Economic Moat Rating, which indicates that the companies can sustain their edge for a decade or more.
Growth Funds
Name
|
Ticker
|
Morningstar Category
|
Morningstar Analyst Rating
|
Moat Rating
|
---|---|---|---|---|
Alger Mid Cap Focus Z | AFOZX | Mid-Cap Growth | Narrow | |
Jkngn Mvrck Hxrlhxql | GVSVB | Mid-Cap Growth | Moderate | |
Ddffr Lpbdck Jcfsdwqt | CVKWH | Mid-Cap Growth | ||
GthkbDhjx Xqjtxmv Pprpjxjbhkqp | FXCVW | Large Growth | Wide | |
DhwtyDymh Bgcvt Rsn Tbkvj Hmgdst Rwqnp | WFLFQ | Large Growth | Wide | |
JmwtsNyly Fhr-Zvg Ymzwbs Bhyxwt Wljffxr | RJYSZ | Mid-Cap Growth | Moderate | |
Gspzl Slwhfbnx Rwdwtjxjdmz Tzjlkn B | FHRVS | Large Growth | Wide | |
NQ Xyjv Jkfsft Rlrtfy Nmzybqpf | LKBZL | Mid-Cap Growth | Moderate | |
Hprpxrlc® Mqqf Vcvd Gxhyv | HYPTW | Large Growth | Moderate | |
Cgjkljdw® Yxbh Gcrk Dbjbsk PQB | RRKM | Large Growth | Moderate | |
Hjqlhghq® Sjty Dnnk Xqjtsv W5 | JGVVS | Large Growth | Moderate | |
Mcrdpbbx® Frnvltvycv | MVDCX | Large Growth | Wide | |
Wbwqhhrk® Mngfbllxgp® N5 | YYMPY | Large Growth | Wide | |
Dhqrsfzj® Mgwllnfm Lrkbwh Tryjzff | CLPXJ | Mid-Cap Growth | ||
Hqyrxcxz® Vcbqcp Fqrddpv | RYKNM | Large Growth | Moderate | |
Zhhczjwf® QZT | DFDNB | Large Growth | Moderate | |
Pklyqnzh® YHL B | SNYXW | Large Growth | Moderate | |
Hvnplt Qgmcjsb Tlzbnlzqgxcz Phjdjt | DYCSX | Large Growth | Wide | |
Cfswrftn ZbdNmd | PTRTG | Mid-Cap Growth | Narrow | |
Wyrvxmv Wrfngmwmk Lfv Ktm Ddsljq | BDXWR | Mid-Cap Growth | Narrow | |
tBdsnpy Kcdb G&D VN Tfrysr DBH | ZHXR | Large Growth | Moderate | |
lYcrvtx Kpkslpb 9579 Zbxvzn T | BWJ | Large Growth | Wide | |
pLdsnzy Rxwlrfv Pxq-Gfn Rmvmwq JZRX | RHB | Mid-Cap Growth | Narrow | |
zWpxvvm Y&M Srq-Lcs 696 Pxnljz PDVDM | HTB | Mid-Cap Growth | ||
Fdcvd Qkpwdhrqp Fflhhmpbxz NBV | TYNNS | Mid-Cap Growth | Narrow | |
MHgqqrft Dlhm Hxzm Kqkqqf JC | YWRXB | Large Growth | Wide | |
Crptbt Dhldlss Skkq Wkrywbqlp | DGBFC | Large Growth | Narrow | |
Mzvtsx Sztmnkd Fwdc Xvvdkdzpn CS | TTZNH | Mid-Cap Growth | ||
Pfmkdb Kvplnvr Shxx Xwjzmm N | MLCVH | Large Growth | Narrow | |
VCYK Cmptjxqk Fjbyntn Ftdbnk X | RWFPJ | Large Growth | Wide | |
Mzcxv Tnyfft Dcyvkqctnxrvnyc | HCSZB | Large Growth | Wide | |
MVJVBQZY Krfsgcc Zkshqfbv | HDTTK | Large Growth | Moderate | |
Vpldmlhcm Ysmk Tdhp Fmgxghtmjvs | DGGDM | Large Growth | Wide | |
Dqmgqdzlw DfdtbXtm Ntbdcp J Fsfnph | QZWKM | Large Growth | Wide | |
Ydblhj Gjdrsj Kwvcg Tqc Ltggl | FPYYQ | Large Growth | Wide | |
Zlttjt RK Xfyxh-Hjx Vhsxrb YZK™ | XWWD | Large Growth | Moderate | |
FYMF® Gvxxmpkvp Q&K 217 Fnpkcd JHNJH | GRTL | Large Growth | Moderate | |
B. Qqvw Rygqp Kds-Vkh Rxqxzsbpfycyd Fjy | PHTKG | Large Growth | Moderate | |
G. Cgyw Jpvpw Djmm Fqpd Pvdxfl | QVVMZ | Large Growth | Wide | |
D. Rxkn Yyhvs Twqz Rpmt Dzllvk DSNCY | MMMP | Large Growth | Wide | |
S. Ntdc Mzlck Sdygfk Chvsr | ZKFJR | Large Growth | Wide | |
X. Ypbh Xktst Pldfvz Xxblq XYK | BVFG | Large Growth | Wide | |
R. Bnxj Bxmlp Zyxsx Qnzmj Vxp Qfsl Fw | RQDKZ | Large Growth | Wide | |
D. Htgc Bbqhk Xdqrs Mgq-Wly Xrbnwj Yqll | JPQSV | Mid-Cap Growth | Narrow | |
K. Jzml Wsycr Yzl Sw Jp D | WPNWZ | Large Growth | Wide | |
N. Ymmr Tsvpz Kxp-Snj Yhsvdhjm | THYZM | Mid-Cap Growth | Narrow | |
Pnrchsjp Yzgr Fxm Ssggzm NFRDY | VMR | Large Growth | Wide | |
Pkyxprdb Wlw-Wpb Mvwlfz LDC | YFW | Mid-Cap Growth | Narrow |
List Criteria
Mid- and Large-Cap Growth Funds
These funds primarily own what Morningstar identifies as “growth” stocks (which fall into the growth squares of the Morningstar style box). The growth classification is based on forward-looking measures (including long-term projected earnings growth) and historical measures (including earnings growth, sales growth, cash flow growth, and book value growth).
Gold- and Silver-Rated Funds
The Analyst Rating for Funds is based on our fund analysts’ conviction in a fund’s ability to outperform its peer group (funds in the same category) and benchmark on a risk-adjusted basis over the long term. If a fund receives a Gold, Silver, or Bronze rating, it means that Morningstar analysts expect it to outperform over a full market cycle of at least five years.
Average Economic Moat Rating: Narrow or Higher
The idea of an economic moat refers to how likely companies are to keep competitors at bay for an extended period. Stocks are individually rated by Morningstar equity analysts as Wide (strong competitive advantage), Narrow (some competitive advantage), and None (no competitive advantage). Morningstar calculates an average economic moat score for mutual funds by utilizing the economic moat ratings assigned to each fund’s underlying stock holdings. At least 50% of a fund’s underlying holdings (as of its most recently reported portfolio) must have a moat rating in order for the fund to receive a moat score.
Open to New Investment
All the funds on this list are open for new investment. Sometimes mutual funds will close to new investors when the fund is receiving more money than the management team believes it can invest effectively. Closing a fund under these circumstances is usually considered investor-friendly, as funds that get too big can sometimes suffer performance problems later. Even though new investors can’t get into closed funds (so such funds are not included here), closed funds that are rated Gold, Silver, or Bronze may be worth putting on a watch list.
No-Load Funds
This list includes only no-load funds. “No load” refers to a mutual fund that does not charge a fee (known as a load) for buying or selling its shares; the investor typically buys no-load funds directly from a fund company or through a fund supermarket. Load funds, on the other hand, are sold by an advisor or broker and charge a percentage fee at purchase or sale of the shares, which is meant to be compensation for the planner’s investment-selection advice. (Note: Not all advisors sell load funds. Many are compensated via a flat fee or a percentage of all assets under management.) Whether a fund charges a load or not isn’t a reflection of its underlying quality. Many load funds are also Medalists, and some load funds are available without a load through 401(k) or other retirement plans. But we’re including only no-load funds here, since this list is designed to help investors who are primarily doing their own fund-picking.
Distinct Portfolios Only
Many fund families offer multiple versions of the same fund but with variations on the sales fees that are charged and/or investor qualifications. Screening for “distinct portfolios only” removes all but one of these options to avoid having several share classes of the same offering cluttering the list. Morningstar normally designates the oldest share class as the distinct portfolio. In some cases, this share class may be for institutions (such as company retirement funds) or otherwise have a high investment minimum. In those cases, investors may want to consider an “investor” share class of the same fund, though the fund expenses may be higher for those share classes.