3 Top Small-Cap Blend Mutual Funds for Outstanding Returns

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Risk-loving investors, who give precedence to capital appreciation along with dividend payouts, may consider small-cap blend mutual funds to derive healthy returns. These funds focus on realizing an appreciable amount of capital growth by investing in stocks that are projected to rise over the long term.

Meanwhile, small-cap funds are good choices for investors seeking diversification across different sectors and companies. Small-cap funds generally invest in companies havina g market cap lower than $2 billion. The companies, smaller in size, offer growth potential and their market capitalization may increase subsequently. Also, due to their less international exposure, small-cap funds offer higher protection than their large and mid-cap counterparts in any global downturn.

Below, we share with you three top-ranked, small-cap blend mutual funds, namely PGIM Jennison Small Company Fund- Class A PGOAX, Fidelity Advisor Series Small Cap Fund FSSFX and MassMutual Small Cap Opportunities Fund Class R5 MSCDX. Each has earned a Zacks Mutual Fund Rank #1 (Strong Buy) and is expected to outperform its peers in the future. Investors can click here to see the complete list of small-cap blend funds.

PGIM Jennison Small Company Fund- Class A seeks long-term capital growth by investing most of its net assets in equity and equity-related securities of less-known small companies with a market cap similar to the company listed on the Russell 2500 Index at the time of investment, PGOAX advisors choose relatively undervalued stocks and maintain a blend of both value and growth style portfolio.

PGIM Jennison Small Company Fund- Class A has three-year annualized returns of 14.3%. As of the end of December 2021, PGOAX had 128 issues and invested 2.07% of its net assets in SAIA.

Fidelity Advisor Series Small Cap Fund invests most of its net assets in small-cap domestic and foreign issues with market capitalization similar to the companies listed on the Russell 2000 Â Index or the S&P SmallCap 600 Index at the time of purchase. FSSFX advisors choose to invest in either “growth” stocks or “value” stocks or sometimes both.

Fidelity Advisor Series Small Cap Fund has three-year annualized returns of 12.1%. FSSFX has an expense ratio of 0.01% compared with the category average of 1.03%.

MassMutual Small Cap Opportunities Fund Class R5 seeks capital appreciation by investing most of its assets along with borrowings, if any, in small-cap common stocks of U.S companies with market capitalization similar to the companies listed on the Russell 2000 Index at the time of purchase. MSCDX advisors use fundamental analysis like favorable business trends along with the prospects to make investment decisions.

MassMutual Small Cap Opportunities Fund Class R5 has three-year annualized returns of 11.1%. Raman Vardharaj has been the fund manager of MSCDX since May 2009.

To view the Zacks Rank and the past performance of all small-cap blend mutual funds, investors can click here to see the complete list of small-cap blend mutual funds.

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