Everyone has heard of people like Warren Buffett, investors who have made billions in the market with their skill, experience, and knowledge. Those kinds of returns, especially in a bear market, are very rare for the average investor. When it comes down to it, many investors just don’t have the portfolio size to get through those downturns in the market. They also lack the mental tenacity it takes to weather out the crazy storms without taking out their money right away. This is why there are so few investors like Warren Buffet out there.
For those of us who don’t want to devote our whole lives to learning the ins and outs of the stock market, there are still options out there to have sustainable gains in our portfolios. This is where mutual funds come into play. With mutual funds, a small fee is paid to a company which invests your money very wisely in a calculated fund. These funds are created by investment professionals who have their clients’ best interest in mind.
Just like anything in the world, there are mutual funds that are better than the rest. Without doing the proper research, an investor could find themselves in a mutual fund that they really aren’t satisfied with. By doing your research, you can find yourself in an amazing mutual fund that works for you and your specific investment needs.
If you are more averse to high risk situations, you may look more into a bond fund. If you are someone who gets a big rush out of that risk and big returns, an aggressive market fund may be more for you. We have taken a look at the best mutual funds as compiled by CNN Money, and chosen a few of our favourites. By taking a look at these funds, you may just find one that fits most, if not all, of your investment needs.
Schwab Total Stock Market Index Fund (SWTSX)
The Schwab Total Index Fund is one of the best-performing mutual funds on the market right now. This mutual fund has not only outperformed other options, but it is based mainly in domestic US stocks, which is good for investors who want to steer away from international investing. Around 95 percent of the fund is based in US stocks. The initial investment for this investment is only $100, which makes it very easy for most investors to try it out.
iShares Core S&P Small-Cap ETF (IJR)
This iShares ETF is a very fast-growing fund to be a part of, especially for an investor who is looking to make some big gains in the next five years. With 27 percent growth in the last five years, investors can really make some great returns with this fund. The top five sectors that this fund focuses on are financial services, Industrial materials, Hardware, Healthcare, and Consumer services.
Vanguard REIT Index Fund Investor Shares (VGSIX)
Vanguard is a highly-trusted name in the world of investments. They have been satisfying investors for many decades now, and continue to wow customers even in the most turbulent of market situations.
The Vanguard REIT funds has had a very impressive past five years, with almost 30 percent growth. This makes the Vanguard REIT fund a very attractive fund for many investors. With a minimum initial investment of $3,000, fledgling investors will have to save up for a little bit of time until they can get into this fund.
This fund focuses on real estate bases investments, so look at how the real estate market is doing before investing in this fund.
T. Rowe Price Capital Appreciation Fund (PRWCX)
For those who are looking to be in a fund for 12 months or less, the T. Rowe Price Capital Appreciation Fund is a great option. In the last 12 months, this fund has had over 17 percent growth. The minimum $2,500 initial investment makes this a fund for at least semi-serious investors. With these kinds of quick gains, there is always the potential downside risk, but the management of this fund is very mature in both their experience and decision-making skills.
PowerShares FTSE RAFI US 1000 Portfolio (PRF)
For those investors who are looking to be in a fund for five years or more, this is an excellent option. This PowerShares fund has yielded returns of nearly 30 percent over the past five years. This fund invests in many consumer staple stocks such as Exxon Mobile, Chevron, GE, AT&T, Citigroup, and more.
This is a great fund for investors who want to be conservative in their stock picks, while still being able to have some great results. This fund is spread out evenly over enough stocks that performance of one individual stock alone will not really impact the entirety of the fund. However, the fund does mimic the overall market trends, as most funds do.
Royce Opportunity Fund Investment Class (RYPNX)
This fund has some of the best 5 year returns of any fund on this list. With over 33 percent growth over the last five years, this is a very attractive fund for investors who are looking to make some great returns. A large part of this fund is the industrial materials industry. This makes up for just about a third of the entire fund.
Not only does this fund have amazing five year returns, but over a period of 12 months, this fund yielded returns of over 30 percent. This is a great fund for those who are looking for long term gains or short term returns.
PRIMECAP Odyssey Aggressive Growth Fund (POAGX)
The Primecap Odyssey Aggressive Growth Fund is one of the most exciting funds that we have here on the list. For those who are looking for massive growth in a short period of time, this is the stock for them. Last year alone this fund had a growth of over 45 percent. That is pretty amazing for a mutual fund.
A downside: This is a risky fund, and individuals need to be able to understand this. When you are going for aggressive growth, you have the potential downside of aggressive losses. Investors who are willing to face this risk might do very well in this mutual fund.
Cohen & Steers Realty Shares Fund (CSRSX)
This fund is for more serious investors, as the initial investment is $10,000. This is a great fund for those who want to stay domestic and invest in US stocks. This fund has had some great five year returns, with the fund up 29% over the last five years. The initial investment requirement of $10,000 can actually be a very good thing for investors. This secures the investor having thousands of dollars of returns over the near future.
This fund is based mainly in the real estate market as well, so make sure to see what the real estate market is doing at your time purchasing the fund.
Dodge & Cox Income Fund (DODIX)
The Dodge & Cox Income fund is a much more conservative mutual fund, but it does serve its purpose. For those investors who want a stable, long-lasting fund, this is a solid choice. As the gains aren’t very large annually, they are very consistent. We have nicknamed this fund the “consistency fund”.
This fund has been around for 25 years, and is a great way for investors to have an extra source of income. The structured annuities from this fund can help an investor have spending money each month during retirement. The minimum initial investment is only $2,500 dollars, so this is a pretty accessible mutual fund for investors to get into.
Loomis Sayles Bond Fund Retail Class (LSBRX)
The Loomis Sayles Bond Fund is a great investment for investors who want to see their money go in different places. The money in this fund goes to many research funds, governments, and other bonds. This is a fairly aggressive bond fund, as many bond funds only gain one percent annually, while this fund gains five percent annually on a regular basis.
This is a great fund for those investors who would like to see their money being used in unique ways, and is also a great fund for those investors who are averse to high risk situations. Bonds are normally a very safe bet when it comes down to it. This is a great all around fund for a novice investor.