Best Mutual Funds To Invest In Now: 12 Top Performers
Written by
Daria Uhlig
Edited by
Susan Kim
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Mutual funds help you build a diverse portfolio and eliminate the need to research stocks and other assets individually. Although they’re generally a safer investment than individual assets, choosing the right mutual funds can be a daunting process, as the options range from incredibly mild to extremely risky. GOBankingRates has compiled some of the best funds of 2024 to help you take the guesswork out of choosing which funds are best for you.
Check Out: 3 Things You Must Do When Your Savings Reach $50,000
How We Chose the Best Mutual Funds for 2024
To identify the best mutual funds for 2024, GOBankingRates looked at a number of factors, including:
- Year-to-date and long-term performance
- Years since fund creation
- Tenure of fund managers
- Morningstar rating
- Brokerage fees
- Expense ratio
Also considered were comparative risk and income for different types of mutual funds. Here are 12 of the best for 2024:
- BlackRock Mid-Cap Value Fund Investor A Shares (MDRFX)
- Madison Dividend Income Fund Class Y (BHBFX)
- Putnam Large Cap Value Fund Class A (PEYAX)
- Janus Henderson Balanced Fund Class T (JABAX)
- BlackRock Sustainable Balanced Fund Investor A Shares (MDCPX)
- Fidelity Multi-Asset Income Fund (FMSDX)
- Calvert Core Bond Fund Class A (CLDAX)
- Payden High Income Fund Investor Class (PYHRX)
- Vanguard High-Yield Tax-Exempt Fund Investor Shares (VWAHX)
- Fidelity OTC Portfolio (FOCPX)
- Fidelity Select Health Care Services Portfolio (FSPHX)
- T. Rowe Price All-Cap Opportunities Fund (PRWAX)
Best Stock Mutual Funds for Low Expense Ratio
The expense ratio is the percentage of a fund’s assets that go to operating expenses. A lower number is better because it means more assets are invested.
1. BlackRock Mid-Cap Value Fund Investor A Shares (MDRFX)
This high-performing fund invests in the stocks of mid-cap companies that fund managers identify as emerging dividend growers. Morningstar rates the fund as having below-average risk — which indicates moderate variations in monthly returns — and above-average returns for its category.
- Year-to-date performance: 1.99%
- Five-year performance: 13.36%
- 10-year performance: 8.32%
- Expense ratio: 1.00%
2. Madison Dividend Income Fund Class Y (BHBFX)
The Dividend Income Fund from Madison aims to generate income and growth by investing in securities of dividend-paying companies with market caps of over $1 billion. Typically, 80% of the fund’s net assets include dividend stocks.
- Year-to-date performance: -0.82%
- Five-year performance: 9.47%
- 10-year performance: 8.68%
- Expense ratio: 0.91%
3. Putnam Large Cap Value Fund Class A (PEYAX)
This fund from Putnam focuses on value stocks with the potential for capital growth, income or both. Most of the fund’s investments are U.S. common stocks. Top holdings include ExxonMobil, Microsoft and PulteGroup.
- Year-to-date performance: 5.09%
- Five-year performance: 14.30%
- 10-year performance: 10.12%
- Expense ratio: 0.64%
Best Asset Allocation Funds
An asset allocation fund invests in a variety of different types of assets to increase diversity.
4. Janus Henderson Balanced Fund Class T (JABAX)
This fund prioritizes long-term capital growth while preserving capital and is balanced by current income. It generally invests 35% to 65% in equity securities and the rest in fixed-income securities and cash equivalents. The fund has a three-year above-average risk rating and average returns.
- Year-to-date performance: 4.58%
- Five-year performance: 9.63%
- 10-year performance: 8.01%
- Expense ratio: 0.66%
5. BlackRock Sustainable Balanced Fund Investor A Shares (MDCPX)
This fund invests in a combination of assets, including stocks, fixed-income securities and derivatives. Although the allocation changes, fund advisors typically keep 25% in equity securities and 25% in senior fixed-income securities such as U.S. government and corporate bonds. The fund has higher-than-average returns and higher-than-average risk for its category.
- Year-to-date performance: 2.40%
- Five-year performance: 9.86%
- 10-year performance: 7.78%
- Expense ratio: 0.81%
6. Fidelity Multi-Asset Income Fund (FMSDX)
The Fidelity Multi-Asset Income Fund invests in equities, investment-grade and non-investment-grade bonds, cash and other assets. It also invests in debt securities. The fund has an above-average risk profile and high returns.
- Year-to-date performance: 4.54%
- Five-year performance: 9.12%
- 10-year performance: N/A
- Expense ratio: 0.81%
Best Bond Mutual Funds
Bond funds diversify your portfolio while providing you with a regular source of income. Although returns are generally lower than you’ll find with stock funds, many bond funds — especially those that invest in investment-grade bonds — are also less risky.
7. Calvert Core Bond Fund Class A (CLDAX)
This fund typically invests at least 80% of its net assets in investment-grade, U.S. dollar-denominated debt securities. Up to 5% of assets may be invested in junk bonds. Despite that, this is a lower-risk fund with high returns.
- Year-to-date performance: -1.75%
- Five-year performance: 3.37%
- 10-year performance: 3.56%
- Expense ratio: 0.74%
8. Payden High Income Fund Investor Class (PYHRX)
The Payden High Income Fund invests in debt instruments and income-producing securities. Typically, 80% of its portfolio consists of corporate debt securities rated below investment grade, which makes the fund riskier than some, but it produces above-average returns.
- Year-to-date performance: 0.60%
- Five-year performance: 5.45%
- 10-year performance: 4.63%
- Expense ratio: 0.60%
9. Vanguard High-Yield Tax-Exempt Fund Investor Shares (VWAHX)
Vanguard’s High-Yield Tax-Exempt Fund is a low-cost mutual fund that produces high returns with average risk for its category. It invests at least 80% of its assets in investment-grade municipal bonds and up to 20% in non-investor-grade bonds.
- Year-to-date performance: 0.12%
- Five-year performance: 2.58%
- 10-year performance: 3.62%
- Expense ratio: 0.17%
Most Established Funds With Long Track Records of High Returns
Each of the winning funds in this category has been around for at least 10 years and produced solid returns. None has an expense ratio higher than 1%.
10. Fidelity OTC Portfolio (FOCPX)
This is a large growth fund that invests at least 80% of its assets in growth and value securities traded on Nasdaq or over the counter, which offers exposure to small- and medium-cap stocks. Over 25% is typically invested in the tech sector.
- Year-to-date performance: 9.35%
- Five-year performance: 18.34%
- 10-year performance: 16.20%
- Expense ratio: 0.79%
11. Fidelity Select Health Care Services Portfolio (FSPHX)
This high-performing fund invests at least 80% of its assets in healthcare stocks — i.e., companies that design, manufacture or sell healthcare-related products or services. Because stocks make up most of the investments, the fund has a higher-than-average risk profile.
- Year-to-date performance: 7.58%
- Five-year performance: 8.63%
- 10-year performance: 10.13%
- Expense ratio: 0.69%
12. T. Rowe Price All-Cap Opportunities Fund (PRWAX)
The All-Cap Opportunities Fund from T. Rowe Price invests at least 65% of its assets in the stocks of American companies operating in sectors that T. Rowe Price has identified as having the fastest or greatest growth potential. It may also invest in foreign stocks. The fund is slightly more risky than average, and it offers high returns.
- Year-to-date performance: 9.73%
- Five-year performance: 19.11%
- 10-year performance: 14.71%
- Expense ratio: 0.81%
What Is the Average Mutual Fund Return?
Average mutual fund returns vary based on the mutual fund type. The best mutual funds to invest in span the gamut from exceptionally high returns to fairly modest returns, all of which are related to risk.
- Stock mutual funds — high risk: 12%
- Bond mutual funds — low risk: 5%-6%
- Money market mutual funds — lowest risk: Around 1%
When looking at returns, you should look at not only the year-to-date return but also five-year, 10-year and lifetime appreciation.
What To Consider When Choosing a Mutual Fund
There’s no surefire way to pick winning mutual funds, but you can maximize your chances of achieving the right balance between growth and risk. If you’re early in your career and have many years before retirement, for example, you might choose mutual funds that invest in riskier small-cap stocks with the potential to produce outsize returns. If you’re closer to retirement, on the other hand, you might opt for less risky funds, like those that invest in Treasury bonds or large-cap stocks, despite their generally smaller returns.
Some mutual funds, called target funds, select a mix of securities based on a target retirement date. Over time, and as that target date approaches, the fund managers rebalance the mix of assets to reduce risk. This is great for a “set and forget” retirement fund.
Keep in Mind
Fundamentally, investors should consider whether they want active or passive funds, whether the fees make sense to them and whether their portfolio as a whole is well balanced. While ranking the best mutual funds by performance is possible, volatility, fees and risk also matter.
John Csiszar contributed to the reporting for this article.
Data is accurate as of Feb. 28, 2024, and is subject to change.
This article has been updated with additional reporting since its original publication.
Editorial Note: This content is not provided by any entity covered in this article. Any opinions, analyses, reviews, ratings or recommendations expressed in this article are those of the author alone and have not been reviewed, approved or otherwise endorsed by any entity named in this article.
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