20 Stock Funds That Flip-Flopped Their Category Rankings

Key Takeaways

• As the stock market’s leadership has rotated away from mega-cap tech stocks to small and value names, some funds have seen big swings in their category rankings over the past 12 months.
• Among the funds going from worst to best is Invesco WilderHill Clean Energy ETF.
• On the flip side, the Invesco S&P 500 High Dividend Low Volatility ETF saw its ranking plunge.

More than the stock market’s leadership has rotated in recent months. Some funds that once sat at the top of their categories have fallen to the bottom of the rankings, while some onetime laggards are now far ahead of their peers. In the background, small-cap and value stocks have overtaken the large-cap growth names that previously led the market. Even among the technology stocks which had led the bull market, there has been a significant performance downturn in some key industries.

This change in leadership has rippled through to fund performance. For example, the $3.4 billion Invesco S&P 500 High Dividend Low Volatility ETF SPHD has fallen to the 96th percentile of the large-cap value category from the 2nd percentile this time last year. On the other hand, the $630 million Invesco WilderHill Clean Energy ETF PBW has risen to the 1st percentile of the small-cap growth category from the 100th percentile.

We drilled into Morningstar’s US stock fund categories to look for names that had significant swings higher or lower in their rankings over the last year as of Feb. 28, 2026. Funds with less than $100 million in assets, leveraged funds, and sector funds were excluded from the screen.

Morningstar analysts evaluate funds over a full market cycle, so short-term swings aren’t necessarily a cause for concern. In many cases, funds’ long-term rankings remain intact and their Medalist Ratings don’t change. However, tracking short-term swings can provide helpful information about funds’ biases and how they can fit into a portfolio.

The Funds that Went from Worst to Best

The fund that moved the farthest up its category’s rankings was the Invesco WilderHill Clean Energy ETF. The largest contributor to its 78.5% gain over the past year was Bloom Energy BE, which rose 576%, adding 7.3 points. It’s currently the fund’s largest holding with a 2.7% weighting. The WilderHill fund had badly underperformed prior to this period, having fallen every year between 2021 and 2024. It remains down from its 2021 peak.

Another notable trend that boosted funds which previously lagged was the rise in small-cap stocks. Over the past year, the Morningstar US Small Cap Index rose 19.6%, the Morningstar US Large-Cap Index rose 16.7%, and the Morningstar US Market Index rose 16.8%. Leaning into small caps paid off. Nine of the 10 funds that rose the most in their category rankings held companies that were smaller on average than their peers. One strategy that leans hard into smaller stocks is the $132 million Bridgeway Ultra-Small Company Market Fund BRSIX. This small-cap value fund holds companies with an average market capitalization of $257 million, compared with $5.6 billion for its category peers.

Another major trend was a resurgence in value stocks, with the Morningstar US Value Index returning 18.2% over the past year, compared with the 15.0% return of the Morningstar US Growth Index. This trend could be seen in the performance of the $10.2 billion iShares MSCI USA Value Factor ETF VLUE, which rose to the 1st percentile from the 90th percentile of the large-cap value category. The ETF’s deep value tilt “should be rewarded in the long term, but investors can expect a bumpy ride,” wrote Morningstar associate analyst Brendan McCann.

Another standout value fund was the $7.3 billion AMG Yacktman Fund YACKX. “The fund lagged badly in 2024 because of big stakes in foreign stocks that slumped, falling near the bottom of the large-value category,” wrote Morningstar associate director Adam Sabban. “However, true to their history, the managers stuck with underperformers they felt still had good upside. Markets offered validation in 2025 and through the first month of 2026 as the fund catapulted to the top decile of the peer group.”

The last major factor came in the form of chip companies, which have been boosted to stratospheric heights by artificial intelligence. Seven of the funds that rose the most in their rankings have double-digit allocations to semiconductor stocks.

The Funds that Went from Best to Worst

The fund that fell the furthest in its category was the Invesco S&P 500 High Dividend Low Volatility ETF. It’s joined on the list by another dividend-focused fund, the $229 million TBG Dividend Focus ETF TBG, which fell to the 92nd percentile from the 2nd percentile in the large-cap value category. Dividend funds often do well when interest rates are falling, as dividend yields get more attractive compared with falling bond yields.

Another factor dragging down both funds: the headwinds facing the chemical industry. Commodity chemicals are currently oversupplied, according to Morningstar analysts Seth Goldstein and Christian Fleming. Among the top five largest detractors to the Invesco S&P 500 High Dividend Low Volatility ETF’s performance were three chemical companies—Dow DOW, LyondellBasell Industries LYB, and Eastman Chemical EMN—which knocked a combined 2.5 points from its 8.2% return over the past year.

LyondellBasell also stripped 1.6 points from the 10.9% return on the TBG Dividend Focus ETF. Two of the ETF’s other largest detractors are the alternative asset managers Blue Owl Capital OWL and Blackstone BX, which cut a combined 2.2 points from its return. These companies have been heavily invested in software firms, which have been spurned by investors, as they fear the industry will be hit hard by artificial intelligence.

Two of the funds suffering big declines in their categories had large weightings to software stocks. The $112 million APLS O’Shares Global Internet Giants ETF OGIG invested 37.6% of its assets in software, while the $131 million Motley Fool Mid-Cap Growth ETF TMFM had 15.1%. Both funds are in the large-cap growth category, and their peers average a 12.4% allocation to the industry. Of the funds that fell the furthest, seven had no allocation to chip stocks, which have been major beneficiaries of AI.