There are many people who invest in stocks to get better returns when compared to the saving schemes. However, it is really important to have good knowledge about the stock market before you can really invest and make profits out of your investments. For the people, who do not have a knowledge of stock markets, there is an investment instrument called Mutual Fund. So, do you what are mutual funds? Well, if you do not know much about Mutual Funds then do not worry as here, we have given an idea of what these mutual funds are all about. Along with that, we have also listed the top 5 best performing mutual funds in large cap category.
What are Mutual Funds?
To begin with, Mutual Funds can be purchased just like shares but when you buy a mutual fund, you are not just buying equity in one stock. The fund house allocates the assets in multiple equities and there are expert fund managers who are managing your money. This eliminates your need to have knowledge of the stock market.
How to Buy Mutual Funds?
Apart from this, there are two ways to buy mutual funds. You can either choose to invest a lump sum amount or you can opt for SIP. If you choose SIP (Systematic Investment Plan) then the money will be taken out of your savings account on regular basis just like an EMI. The difference is that this money will be used to purchase mutual funds. It is always better to invest via SIP Mode as it not only adds discipline to the investments but it also reduces the point risk because of market volatility.
What Factors to Consider to buy Best Mutual Funds?
Now, you have a basic idea about the mutual funds but while buying the mutual funds, there are some factors that you need to consider. You can look at the expense ratio and it should be low. You must also look at the historic performance of the fund. Look at the 3 years and 5 years return to get an idea of the performance. Moreover, you can also check the asset allocation type. You will find funds that invest money in Mid Cap, Small Cap and in Large Cap stocks. This basically determines the types of mutual funds you are investing in.
Top 5 Best Performing Mutual Funds in 2019
Below is the list of Top 5 Mutual Funds available in the market for your mutual funds investment needs. You can choose to invest in 1 of these top mutual funds or you can choose multiple funds to invest in.
Nationwide Ziegler NYSE Arca Tech 100A
The technology sector had always been growing at a high rate and if you are planning to invest in a fund that allocates it funds towards technology then you can opt for this mutual fund. It is one of the best mutual funds for technology and it has an expense ratio of 0.79%. Talking about the fund returns, the fund has given 1 year return of 24.65% and the 3 year return for the fund is 20.5%. The fund managers of this fund have invested in companies like Boeing, Biogen, NVIDIA, Adobe, Raytheon and many other companies.
Shelton NASDAQ 100 Index Direct
Next on our list is Shelton NASDAQ 100 Index Direct and this is again a high risk fund but do not forget that the higher the risk, the higher the returns. The overall expense ratio for this fund is 0.59%. The fund has major allocation towards technology but the fund managers have also invested in consumer Cyclical, healthcare, Consumer Defensive and Communication Services. This basically adds diversification to the portfolio. The three year and 5 year return for the fund is 21.5% and 19.4% respectively. In such a case, it becomes an attractive option for the investors to make investments on this fund.
VALIC Company I NASDAQ 100 Index
Next on the list is VALIC Company Mutual Fund Fun and this fund allocates over 50% of the funds in Technology. Also, there is about 20% of funds that are routed in Consumer Cyclical. Apart from this, minor investment goes into Healthcare, Consumer Defensive and Communication Services. The fund has invested 10% of the capital in Apple and another 10% is allocated to Amazon. Even Microsoft accounts for about 9% of the total investments here. With all these holdings, the 3 year return of the fund stands at about 21.31% and the 5 year return stands at about 19.97%.
USAA NASDAQ 100 Index
If you wish to invest in a fund that has a very aggressive risk profile then you can opt for USAA NASDAQ 100 Index Fund. The expense ratio of the fund is 0.1% but it certainly offers a good return. Looking at the historical data, the 5-year return for the fund is over 20.79% and 1 year return is already over 28%. This fund also has major holdings in Technology and Communication Sector. Talking about the companies that the fund has invested in, it includes Apple, Amazon, Microsoft, Alphabet, Facebook, Intel, Cisco and Nvidia. This is certainly something that you must look at.
Now, as per our analysis, the best mutual fund available in the large cap is Fidelity OTC. The fund has a little high expense ratio of 0.81% but the performance is certainly according to this. The 1 year return of the funds is 29.4% and the 3 year returns are over 23.5%. This fund also has a major holding in the technology sector as it holds stocks of companies like Apple, Amazon, Facebook, NVIDIA, Tesla and Microsoft. You must look at this fund before choosing any other fund as the returns and the risk profile will be very appealing for you.
Disclaimer – Mutual Funds Investments are subjected to market risk and hence we do not guarantee any type of fixed return. The returns of these mutual funds are dependent on market conditions and performance.