Small-cap blend funds are a type of equity mutual funds which hold in their portfolio a mix of value and growth stocks, where the market capitalization of the stocks are generally lower than $2 billion. Blend funds are also known as “hybrid funds.” Blend funds aim for value appreciation by capital gains. It owes its origin to a graphical representation of a fund’s equity style box.
In addition to diversification, blend funds are great picks for investors looking for a mix of growth and value investment. Meanwhile, small-cap funds are a good choice for investors seeking diversification across different sectors and companies. Investors with a high risk appetite should invest in these funds.
Below we will share with you three buy-rated small-cap blend mutual funds . Each has earned a Zacks Mutual Fund Rank #1 (Strong Buy) as we expect these mutual funds to outperform their peers in the future. To view the Zacks Rank and past performance of all small-cap blend mutual funds, investors can click here to see the complete list of funds .
Federated MDT Small Cap Core A (QASCX) invests the majority of its assets in stocks of small-cap companies. QASCX invests mostly in companies listed in the Russell 2000 Index. QASCX seeks long-term growth of capital and its investments aren’t restricted to equity securities of domestic issuers. The Federated MDT Small Cap Core A fund has a three-year annualized return of 13.2%.
As of December 2015, QASCX held 200 issues, with 1.66% of its assets invested in West Corp
Fidelity Advisor Stock Selector Small Cap A (FCDAX) seeks capital growth. FCDAX invests a major portion of its assets in companies with small market capitalizations similar to those companies listed on the Russell 2000 Index or the S&P SmallCap 600 Index. FCDAX distributes across different market sectors. The Fidelity Advisor Stock Selector Small Cap A fund has a three-year annualized return of 8.6%.
FCDAX has an expense ratio of 1% as compared to the category average of 1.22%.
JPMorgan US Small Company A (JTUAX) invests a large portion of its assets in equity securities of small cap U.S. companies. These small cap companies have market capitalization similar to those companies listed on the Russell 2000 Index during the time of purchase. The JPMorgan US Small Company A fund has a three-year annualized return of 10%.
As of February 2016, JTUAX held 388 issues, with 1.44% of its assets invested in Take-Two Interactive Software Inc.
To view the Zacks Rank and past performance of all small-cap blend mutual funds, investors can click here to see the complete list of funds .