To find a good one, start somewhere other than returns.
/s3.amazonaws.com/arc-authors/morningstar/fcc1768d-a037-447d-8b7d-b44a20e0fcf2.jpg "3 Great Aggressive Growth Funds (1)")
Russel Kinnel
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Russel Kinnel: Aggressive growth funds are red-hot. Excitement about AI and a strong economy have them surging from a tough 2022. As a result, this is a pretty bad time to buy an aggressive growth fund. Because these funds run hot and cold, it’s better to wait for them to go cold or simply commit to an automatic investment plan so that you’ll be buying consistently over the years.
To find a good aggressive growth fund, start somewhere other than returns. You can start with Medalist Ratings, or expense ratios, or a fund company, just leave returns until later. I looked for medalists with above-average growth rates and below-average fees.
3 Great Aggressive Growth Funds
- Morgan Stanley Institutional Discovery MPEGX
- Vanguard Mid-Cap Growth VMGRX
- T. Rowe Price Mid-Cap Growth RPMGX
Morgan Stanley Institutional Discovery is a super aggressive fund run by Dennis Lynch and a team of 26. They look for companies with strong business models and the potential for enormous growth. They aren’t afraid of industry concentration or high valuations. Just look at the top holdings and you’ll see how aggressive they are. Names like Cloudflare NET, Roblox RBLX, and Snowflake SNOW tell you that there’s never going to be a dull moment with this fund. You really have to share management’s long-term focus to make this one work, though, because the downside is very real.
Vanguard Mid-Cap Growth is a super cheap way to gain exposure to fast-growing companies. Frontier Capital Management runs 60% of the portfolio, and Wellington runs 40%. They’re not as aggressive as Morgan Stanley, though. They want growth but prefer steady growers. More than half of the portfolio is in tech and healthcare. Fees are just 35 basis points, so the fund has an edge on peers that works year in and year out.
T. Rowe Price Mid-Cap Growth is a real standout run by Brian Berghuis. In the past, he’s made a nice return with the likes of Tesla TSLA and Netflix NFLX. Today, he’s betting on companies like Hologic HOLX and Marvell Technology MRVL. Berghuis has beaten his mid-growth benchmark by a wide margin over his career. We give the fund High pillar ratings for Process, People, and Parent. I bought the fund when it reopened last year.
Watch “3 Most Hated Funds” for more from Russel Kinnel.
The author or authors own shares in one or more securities mentioned in this article.Find out about Morningstar’s editorial policies.
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About the Author
About the Author
Russel Kinnel
Director
Russel Kinnel is director of ratings, manager research, for Morningstar Research Services LLC, a wholly owned subsidiary of Morningstar, Inc. He heads the North American Medalist Rating Committee, which vets the Morningstar Medalist Rating™ for funds. He is the editor of Morningstar FundInvestor, a monthly newsletter, and has published a number of prominent studies of the fund industry covering subjects such as manager investment, expenses, and investor returns.
Since joining Morningstar in 1994, Kinnel has analyzed virtually every type of fund and has covered the most prominent fund families, including Fidelity, T. Rowe Price, and Vanguard. He has led studies on the predictive power of fund data and helped develop the Morningstar Rating for funds and the Morningstar Style Box methodology. He was co-author of the company's first book, Morningstar Guide to Mutual Funds: 5-Star Strategies for Success (Wiley, 2003), and was author of the book Fund Spy: Morningstar's Inside Secrets to Selecting Mutual Funds That Outperform, published in 2009.
Kinnel holds a bachelor's degree in economics and journalism from the University of Wisconsin.
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