Top Mutual Funds and ETFs that can Outperform in Long Term

Before we continue further, let’s make one point clear that none of the picks mentioned in this write-up make up to be hot or buzzing funds. All the names below are high quality funds that can be used to construct a long term portfolio. We are also expecting them to outperform other funds in the coming year, so even short term investors can park their investments here.

When researching fund investments, one can easily get confused as there are so many categories and subcategories to choose from. So, to make it easier for you to decide, we have listed our picks along with a brief description of the category they fall in.

Top 4 Picks from Income Funds and Blended Funds

Ideal for risk-averse investors, income funds and blended funds focus on providing a regular stream of income and at the same time these ensure ample capital appreciation in the long run. The performance of such funds can remain somewhat subdued when the markets are in a bullish phase, but these certainly outshine in tough times.

Income Fund Picks for 2011

• AHITX is a income fund with a focus on high yields. This funds expense ratio is 0.68% and so far it has appreciated 6% this year. Its growth in last five years has been plus six percent.
• DODIX (Dodge & Cox Income Fund) is an intermediate term fund with above 3% growth this year and plus 6% growth in last five years. Expense ratio for this fund is at 0.43%.

Blended Funds Picks for 2011

• SLASX is a blend of selected American shares and has delivered staggering 8% return this year, but its five year returns lag below 1%. Its expense ratio is a bit high at 0.94%.
• VFINX is a Vanguard 500 Index Fund with a double digit growth this year and just 1% growth over last five years. Expense ratio for this one is really attractive at 0.18%.

 

Top 3 Value Funds for 2011

Identifying low price/earnings is the key that fund managers rely upon while searching value picks. Another factor they consider is a low price/book ratio.

Large Cap Value Funds for 2011

• AMRMX is a value fund with a decent 7% plus return this year and a over 2% in last five years. Its expense ratio is at 0.67%
• SSHFX (Sound Shore Fund) is a value fund with around 7% this year and a flattish performance over last five years. Expense ratio for this one is high at 0.94%

Medium Cap Value Fund for 2011

• DEFIX (Delafield Fund) is the only mid cap value fund on our radar for 2011. It has notched 23% return this year and around 7 percent in last five years. However, expense ratio at 1.26% is the main dragger here.

Apart from our top rated picks mentioned above, anyone with a longer term investment horizon may even invest in below listed fund categories and Picks.

Specialty Fund Picks for 2011 and beyond

• VNQ – Real Estate ETF
• PRNEX – Natural Resources Fund
• DVY – Dividend Stocks Fund

Growth Fund Picks for 2011 and beyond

Small Cap Growth Fund

• RYVPX
• WAAEX

Medium Cap Growth Fund

• MERDX
• POAGX

Large Cap Growth Fund

• JENSX
• TRBCX

Dislaimer-

Investing in Funds is subject to market risks and we do not guarantee any profits from the picks mentioned in this article. We have compiled the list after researching through advices given on various financial websites and other financial media. So conduct your own research or avail services of a financial advisor before making any investments.