Like food and oxygen, aggressive growth is something to which few investors would say no, especially in the current volatile market. If only it wasn’t accompanied by that nasty downside risk.
Zacks Investment Research compiled a list of solid aggressive growth funds that still have their fair share of risk, but are getting promised returns nonetheless.
“Investors aiming to harness maximum gains from a surging market often select aggressive growth funds,” Zacks writes. “This category of funds invests heavily in undervalued stocks, IPOs and relatively volatile securities in order to profit from them in a congenial economic climate. Securities are selected on the basis of their issuing company’s potential for growth and profitability. By holding a larger number of securities and adjusting portfolios keeping in mind market conditions, aggressive growth funds offer a less risky route to investing in these instruments.”
Here are the top five aggressive growth mutual funds according to the research firm, which “earned a Zacks’ No 1. Rank (strong buy) as [it] expects these mutual funds to outperform their peers in the future.”
Legg Mason ClearBridge Aggressive Growth A (NASDAQ:SHRAX) OK, so Bill Miller’s value plays haven’t exactly worked out, but luckily Legg Mason has a few other arrows in its quiver.
According to Zacks, “the fund focuses on acquiring equity securities of companies whose earnings growth is higher than the average returned by firms which make up the S&P 500. The aggressive growth mutual fund has a three year annualized return of 20.39%.”
Richie Freeman and Evan Bauman are co-managers of the Legg Mason ClearBridge Aggressive Growth fund.
Delaware Select Growth A (NASDAQ:DVEAX) invests in companies with superior growth potential and the ability to grow faster than the domestic economy, Zacks reports.
“The fund invests in companies with a wide range of market capitalizations which are attractively priced. The aggressive growth mutual fund returned 15.51% over the last one year period.”