Investors looking for exposure to both value and growth stocks, while seeking returns at a lower level of risk, may consider large-cap blend mutual funds. Large-cap funds offer more stability than mid or small caps and are thus safer. Generally, companies with market capitalization of more than $10 billion are considered large cap. However, due to their significant international exposure, large-cap companies run the risk of being hit by global woes.
Blend funds - also called hybrid funds - owe their origin to the graphical representation of their equity style box. In addition to diversification, blend funds offer a great mix of growth and value investment.
Below, we share with you three top-ranked large-cap blend mutual funds. Each has earned a Zacks Mutual Fund Rank #1 (Strong Buy) and is expected to outperform its peers in the future.
American Century Equity Growth Fund Investor (MUTF:BEQGX) seeks growth of capital for the long run. BEQGX invests the lion's share of its assets in equity securities. The portfolio manager applies quantitative management techniques in a two-step process to select stocks. The portfolio manager ranks stocks of U.S. companies that have market capitalization of more than $2 billion and then uses a quantitative model to build a portfolio of stocks from that ranking. American Century Equity Growth Fund Investor has three-year annualized returns of 6.2%.
BEQGX has an expense ratio of 0.67% compared with the category average of 0.99%.
Vanguard Growth and Income Fund Investor Shares (MUTF:VQNPX) invests in a diversified group of stocks chosen with the help of quantitative analysis. VQNPX seeks stocks that are believed to provide dividend income, have an impressive growth prospect and, as a group, are likely to provide higher returns than the Standard & Poor's 500 Index while having similar risk characteristics. The fund invests a minimum of 65% of its assets in companies included in the index. Vanguard Growth and Income Fund Investor Shares has three-year annualized returns of 8.9%.
As of June 2017, VQNPX held 851 issues, with 4.04% of its assets invested in Apple Inc. (NASDAQ:AAPL).
Goldman Sachs U.S. Equity Insights Fund Class A (MUTF:GSSQX) seeks capital appreciation and dividend income over the long run. GSSQX maintains a diversified portfolio by investing primarily in equity securities of companies located in the U.S. GSSQX may also invest in securities of foreign firms traded in the U.S. The fund may also consider investing in fixed income producing securities to build its portfolio. Goldman Sachs U.S. Equity Insights Fund Class A has three-year annualized returns of 8.4%.
Len Ioffe is one of the fund managers of GSSQX since 2011.