These Large-Growth Medalists Saw Big Gains in 2017
Katie Reichart: While the U.S. equity market had a great year in 2017, growth funds did particularly well. Of all the diversified Morningstar U.S. equity categories, large-growth funds led the way, with the average fund up almost 28% for the year and the Russell 1000 Growth Index gaining 30%. That reversed the trend seen in 2016, when value outperformed growth.
In 2017, many large-growth funds got a boost from the hot performing technology sector, especially giants Apple, Amazon, and Facebook.
Some Morningstar Medalists did particularly well. Gold-rated T. Rowe Price Blue Chip Growth was up almost 37%, with stakes in Chinese Internet names Alibaba and Tencent boosting returns.
Silver-rated Fidelity Growth Company also was up about 37%. It did particularly well with its top holding, Nvidia, a 7% position that its manager first started buying in 2008.
Gold-rated Harbor Capital Appreciation held about 60% of its assets in technology-related firms and posted a similar gain.
Following these big gains, investors using large-growth funds as core holdings may want to consider rebalancing in the new year to be sure they don't consume an outsize stake of their portfolios.