Despite the recent excitement in the stock and cryptocurrency markets following the Bitcoin (BTC-USD) halving event, investing in top mutual funds remains an effective strategy. While mutual funds might not seem as thrilling, their performance often outshines more volatile investments. This year, several mutual funds have even outperformed the S&P 500 index.
The primary benefit of investing in top-performing mutual funds is active management. These funds provide access to professional teams dedicated to achieving the fund’s goals. During bear markets, these professionals demonstrate their value, separating strong investors from the weak with their superior risk management strategies.
Fund managers utilize the best information and resources to make profitable adjustments to the fund’s holdings, ensuring consistent performance.
With that in mind, here are seven mutual funds to buy now for June 2024. These funds have been selected for their strong performance and safety during downturns, which may reduce drawdowns and investor losses.
Fidelity Blue Chip Growth Fund (FBGRX)
Fidelity Blue Chip Growth Fund (MUTF:FBGRX) focuses on large-cap growth companies, primarily in the information technology sector.
The FBGRX fund, with assets totaling $63.38 billion, requires no minimum investment and has a turnover rate of 19%. The fund provides a semi-annual dividend with a yield of 0.73% and has shown significant returns, including a year-to-date return of 28.11% and a five-year return of 172.92%.
It maintains a diversified portfolio with 363 holdings and an expense ratio of 0.69%.
FBGRX invests at least 80% of its assets in blue-chip companies with large or medium market capitalizations. The fund employs fundamental analysis to select investments, considering each issuer’s financial condition, industry position, and broader market and economic conditions. With a beta of 1.27 over five years, the fund has demonstrated a balance of risk and return.
Some of FBGRX’s largest holdings include Apple (NASDAQ:AAPL) and Alphabet (NASDAQ:GOOG,GOOGL).
Fidelity Contrafund (FCNTX)
Known for its strategy of investing in undervalued companies, Fidelity Contrafund (MUTF:FCNTX) includes major holdings like Meta Platforms (NASDAQ:META) and Amazon (NASDAQ:AMZN). It has delivered substantial returns over the last 12 months and has a reasonable expense ratio of 0.39%
In the past year, the fund achieved a total return of 41.61%. Since its inception, the fund’s average annual return, including dividends, has been 6.70%.
The fund, with assets totaling $137.73 billion requires no minimum investment and has a turnover rate of 16%. The fund offers a dividend with a yield of 2.53%, although its dividend growth has decreased by 63.58%. It has a beta of 1.03 over five years, indicating moderate volatility relative to the market. The fund’s 52-week high is $20.13, and its low is $14.50.
FCNTX offers a higher dividend than that of traditional ETFs and its slightly higher beta may provide an attractive risk-to-return payoff.
T. Rowe Price U.S. Equity Research Fund (PRCOX)
The T. Rowe Price U.S. Equity Research Fund (MUTF:PRCOX) aims to closely mirror the S&P 500 while providing potential excess returns.
The fund seeks long-term capital growth and follows a disciplined portfolio construction process, weighting each sector and industry approximately the same as the S&P 500 index. With fund assets totaling $11.12 billion, it has an expense ratio of 0.44% and a turnover rate of 47%.
The fund requires a minimum investment of $500,000 and primarily invests in large-cap U.S. common stocks but may also include small- and mid-cap stocks and foreign exposure. It offers an annual dividend with a yield of 1% and a dividend growth rate of 17.16%
PRCOX’s high turnover rate is indicative of a very hands-on management strategy. For large sums involved, it is essential to maintain capital without taking excessive risk. This turnover however has allowed it to lag behind the the total return of the S&P 500 if we use returns since inception as a benchmark. But it could be useful for those who are more focused on growing their wealth slowly and predictably, essential for a retirement nest egg.
Oakmark Fund Investor Class (OAKMX)
The Oakmark Fund Investor Class (MUTF:OAKMX) mutual fund focuses on buying securities priced significantly below their intrinsic value. It has a diverse portfolio and a solid track record of performance.
The fund, established on Aug. 5, 1991, operates with a value investment philosophy, selecting equities based on the belief that a company’s stock price will eventually align with its intrinsic value as estimated by the adviser.
With assets totaling $21.70 billion, the fund has an expense ratio of 0.91% and a turnover rate of 52%. The minimum investment required is $1,000, and it offers an annual dividend with a yield of 0.97% and a significant dividend growth rate of 43.84%.
OAKMX has shown strong performance with a one-year return of 18.55% and a five-year return of 100.13%. It has a beta of 1.02 over five years, indicating slightly higher volatility than the market.
OAKMX is one of the few mutual funds that has a demonstrated potential of beating a passively-managed index over the long run via rigorous technical analysis but its expense ratio is substantial.
Fidelity Select Semiconductors Portfolio (FSELX)
The Fidelity Select Semiconductors Portfolio (MUTF:FSELX) is focused on the booming semiconductor sector; this fund has experienced outstanding returns with a high turnover rate. Major holdings include Nvidia (NASDAQ:NVDA) and other blue-chip semiconductor picks.
Established on July 29, 1985, the fund holds assets totaling $19.04 billion, with an expense ratio of 0.65% and a turnover rate of 32%. It requires no minimum investment and is non-diversified.
The fund utilizes fundamental analysis to select investments. FSELX offers a semi-annual dividend with a yield of 4.69% and a notable dividend growth rate of 78.63%. FSELX has demonstrated remarkable performance, with a year-to-date return of 53.73% and a one-year return of 66.04%.
Over the past five years, the fund has achieved an impressive return of 471.52%, reflecting its strong growth potential. The fund has a beta of 1.85 over five years, indicating higher volatility compared to the market.
Due to the cyclical nature of the semiconductor industry and FSELX’s strong beta, it could be used to accelerate a long-term investor’s total return if they prefer active management of their investments.
T. Rowe Price Blue Chip Growth Fund (TRBCX)
The T. Rowe Price Blue Chip Growth Fund (MUTF:TRBCX) targets large, well-established companies with a history of strong performance. It is well-regarded for its consistent returns and strategic investment approach.
With a focus on companies possessing leading market positions, seasoned management, and strong financial fundamentals, the fund is non-diversified. Established on June 30, 1993, TRBCX holds assets totaling $60.43 billion, has an expense ratio of 0.70%, and a turnover rate of 9.80%. The minimum investment required is $2,500. The fund offers an annual dividend with a yield of 2.78%, although its dividend growth has decreased by 14.20%.
TRBCX has demonstrated strong performance with a one-year return of 40.85% and a five-year return of 97.41%. The fund’s year-to-date return stands at 25.41%.
TRBCX holds 92 investments and, despite having an average performance rating and an above-average risk rating, has maintained a consistent average annual return of 9.92% since its inception.
Vanguard Total Stock Market Index Fund Admiral Shares (VTSAX)
The Vanguard Total Stock Market Index Fund Admiral Shares (MUTF:VTSAX) aims to track the performance of the entire U.S. stock market, offering broad diversification at a low cost. It is a popular choice for long-term investors looking for comprehensive market exposure.
VTSAX employs an indexing investment approach designed to track the performance of the CRSP US Total Stock Market Index (MUTF:CRSPTM1) which represents approximately 100% of the investable U.S. stock market.
Established on Nov. 13, 2000, the fund holds assets totaling $1.60 trillion, with an expense ratio of 0.04% and a turnover rate of 2%. The minimum investment required is $3,000. VTSAX offers a quarterly dividend with a yield of 1.31% and a dividend growth rate of 8.44%.
VTSAX has shown solid performance with a one-year return of 25.35% and a five-year return of 97.23%. The fund’s year-to-date return stands at 13.43%.
VTSAX holds 3,721 securities, maintaining a broadly diversified collection to approximate the full index. Despite having an average performance rating and an above-average risk rating, the fund has achieved a consistent average annual return of 6.42% since its inception.
On the date of publication, Matthew Farley did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
