This month’s Mutual Fund First Cut seeks domestic small-cap stock funds that have performed well compared to their peers over the last five years.
This month’s Mutual Fund First Cut seeks domestic small-cap stock funds that have performed well compared to their peers over the last five years. The list of small-cap funds in the table is grouped by the small-cap stock categories of blended, growth and value and ranked by five-year return within each group. Because individual investors do not typically invest in funds for the short term, it is important to compare funds based on their longer-term performance.
Category averages were included to better compare each fund to its peers and to see how the different investing styles performed.
Funds without consistent and strong relative performance within their categories were eliminated by requiring five-year, three-year and one-year A+ Investor return grades of C or better. The screen excludes funds with loads and requires an expense ratio category rank below 50%. The passing funds are also open to new investors, with a minimum initial purchase no higher than $50,000.
To eliminate funds with excessive risk, funds with an A+ Investor category risk grade of F were excluded. Institutional funds were also excluded, in addition to funds with special share classes. In total, 21 funds made the First Cut.
The category risk index was included to assess the volatility of each fund. If you are going to invest in an actively managed mutual fund with higher risk relative to its peers, you should be properly compensated with higher relative returns.
Small-cap funds have high one-year returns due to the economic recovery from the 2020 bear market caused by the coronavirus pandemic. Additionally, value strategies outperformed growth and blend strategies in the last year; the types of sectors normally considered to be within the value category did well this year as the U.S. recovered strongly.
Small-Cap Funds Showing Strong & Consistent Relative Performance
(Ranked by Five-Year Return)
| Category | Fund | Ticker |
5-Yr Ann’lizd Ret (%) |
5-Yr Ret Cat Grade |
3-Yr Ann’lizd Ret (%) |
3-Yr Ret Cat Grade |
1-Yr Ann’lizd Ret (%) |
1-Yr Ret Cat Grade | Category Risk Index |
Exp Ratio (%) |
Total Assets ($ Mil) |
Index Fund |
|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Small Blend | Thrivent Small Cap Stock S | TSCSX | 18.6 | A | 16.7 | A | 66.4 | A | 0.99 | 0.84 | 1,271 | |
| Small Blend | Fidelity Stock Selector Small Cap | FDSCX | 15.3 | A | 15.2 | A | 49.9 | C | 0.91 | 1.02 | 2,077 | |
| Small Blend | Touchstone Small Company Y | SIGWX | 15.1 | A | 12.7 | A | 61.3 | A | 1.01 | 0.90 | 992 | |
| Small Blend | Northern Small Cap Index | NSIDX | 14.1 | B | 11.2 | B | 51.7 | C | 1.00 | 0.15 | 1,622 | Yes |
| Small Blend | Vanguard Tax-Mgd Sm Cp Adm | VTMSX | 14.1 | B | 10.2 | C | 56.2 | B | 1.00 | 0.09 | 9,239 | |
| Small Blend | iShares Russell 2000 SmCp Idx Inv A | MDSKX | 14.0 | B | 11.2 | B | 51.5 | C | 1.00 | 0.37 | 3,289 | Yes |
| Small Blend | VALIC Company I Small Cap Index | VCSLX | 13.9 | B | 11.1 | B | 51.5 | C | 1.00 | 0.44 | 1,428 | Yes |
| Small Blend | T. Rowe Price Small-Cap Value | PRSVX | 13.8 | B | 11.2 | B | 50.9 | C | 0.93 | 0.80 | 13,389 | |
| Small Blend | Russell Inv US Small Cap Equity M | RUNTX | 13.8 | B | 11.2 | B | 61.2 | A | 1.01 | 1.03 | 1,497 | |
| Small Blend | BNY Mellon Small Cap Stk Idx Inv | DISSX | 13.6 | B | 9.7 | C | 56.3 | B | 1.02 | 0.50 | 1,929 | Yes |
| Small Blend | Columbia Small Cap Index A | NMSAX | 13.6 | B | 9.7 | C | 56.1 | B | 1.02 | 0.45 | 4,358 | Yes |
| Small Blend | Northern Small Cap Core I | NSGRX | 13.1 | C | 10.6 | C | 49.8 | C | 0.93 | 0.60 | 545 | |
| Small Blend | Fidelity Small Cap Enhanced Index | FCPEX | 12.8 | C | 11.4 | B | 55.8 | B | 1.00 | 0.64 | 738 | |
| Small Blend Category Average | 12.4 | 9.9 | 51.5 | 1.10 | ||||||||
| Small Grth | Fidelity Small Cap Growth | FCPGX | 21.1 | B | 18.6 | C | 44.6 | B | 0.92 | 1.09 | 6,257 | |
| Small Grth | TCM Small Cap Growth | TCMSX | 20.0 | C | 16.7 | C | 41.9 | C | 0.97 | 0.95 | 505 | |
| Small Grth | Vanguard Explorer Adm | VEXRX | 19.9 | C | 19.0 | C | 45.7 | B | 0.98 | 0.30 | 24,308 | |
| Small Grth | Vanguard Explorer Inv | VEXPX | 19.8 | C | 18.9 | C | 45.5 | B | 0.98 | 0.41 | 24,308 | |
| Small Growth Category Average | 19.6 | 18.9 | 43.7 | 1.26 | ||||||||
| Small Value | Applied Finance Explorer Investor | AFDVX | 16.5 | A | 14.6 | A | 65.7 | B | 0.96 | 1.08 | 152 | |
| Small Value | Bridgeway Small-Cap Value | BRSVX | 15.8 | A | 14.7 | A | 105.8 | A | 1.05 | 0.94 | 239 | |
| Small Value | Fidelity Small Cap Value | FCPVX | 12.7 | A | 12.6 | A | 71.6 | A | 0.92 | 0.96 | 4,270 | |
| Small Value | Nationwide Bailard Cogntv Val M | NWHFX | 10.3 | C | 9.5 | B | 66.5 | B | 0.96 | 1.08 | 102 | |
| Small Value Category Average | 10.6 | 8.0 | 62.0 | 1.22 | ||||||||
| Source: AAII/Morningstar. Data as of 7/31/2021. | ||||||||||||
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Daniel J from TX posted over 4 years ago:
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