Getting 12% on a mutual fund is the dream. Getting 12% means you’re beating the stock market and you’ll be able to retire comfortably. You may be reading this because you’ve heard Dave Ramsey say that such funds exist and you just need to find them. So, I decided to do some research to make a list of mutual funds that have averaged 12% for the past five years.

Starting with one of Dave’s favorite funds (we think based on what he’s said regarding American funds – he has never made his investment portfolio public), my research has led to the following list:

1. American Funds Growth Fund of Amer A (AGTHX)

It is a large capitalization fund which invests in primarily US equities. This fund in particular is one Dave Ramsey often uses as an example of a fund that can earn 12% annually.

Founded: 1973

5 Year Average Return: 12.57%

10 Year Average Return: 7.23%

Net Assets: 147.13 billion

Major Holdings: Amazon.com Inc, United Health Group Inc

Morningstar Return Rating: 3

Morningstar Risk Rating: 2

Expense Ratio: 0.65

2. AB Large Cap Growth R (ABPRX)

The fund focuses mainly on the stocks of large domestic growth companies.

Founded: 2003

5 Year Average Return: 15.28%

10 Year Average Return: 8.79%

Net Assets: 2.82 billion

Major Holdings: Facebook Inc, Apple Inc

Morningstar Return Rating: 5

Morningstar Risk Rating: 4

Expense Ratio: 1.53

3. Alger Capital Appreciation A (ACAAX)

The fund invests in US stocks with long term growth potential.

Founded: 1996

5 Year Average Return: 14.09%

10 Year Average Return: 10.78%

Net Assets: 2.61 billion

Major Holdings: Apple Inc, Google

Morningstar Return Rating: 4

Morningstar Risk Rating: 4

Expense Ratio: 1.24

4. Thrivent Large Cap Growth Fund Class A (AAAGX)

The fund mainly invests in large capitalization domestic companies, following indices like S&P 500, Russell 1000 Growth Index etc.

Founded: 1999

5 Year Average Return: 13.03%

10 Year Average Return: 6.76%

Net Assets: 710.60 million

Major Holdings: Apple Inc, Facebook Inc

Morningstar Return Rating: 3

Morningstar Risk Rating: 4

Expense Ratio: 1.20

5. American Century Legacy Large Cap Fund Advisor Class (ACGDX)

The fund mainly invests in large capitalization U.S. companies with accelerating growth.

Founded: 2006

5 Year Average Return: 12.66%

10 Year Average Return:

Net Assets: 23.06 million

Major Holdings: Apple Inc, UnitedHealth Group Incorporated

Morningstar Return Rating: 5

Morningstar Risk Rating: 4

Expense Ratio: 1.36

6. AB Core Opportunities Fund Class A (ADGAX)

It invests in domestic companies of any size with long term growth potential.

Founded: 1999

5 Year Average Return: 13.20%

10 Year Average Return: 7.30%

Net Assets: 23.06 million

Major Holdings: Apple Inc, UnitedHealth Group Incorporated

Morningstar Return Rating: 3

Morningstar Risk Rating: 4

Expense Ratio: 1.20

7. American Century Disciplined Growth Fund Investor Class (ADSIX)

The fund invests 99% of its capital in U.S. companies with more than $2 billion market capitalization.

Founded: 2005

5 Year Average Return: 13.15%

10 Year Average Return: 7.30%

Net Assets: 1.05 billion

Major Holdings: Amazon.com Inc, Apple Inc

Morningstar Return Rating: 4

Morningstar Risk Rating: 3

Expense Ratio: 1.02

8. AB Growth Fund Class B (AGBBX)

The fund invests in domestic companies of any size with long term growth potential.

Founded: 1987

5 Year Average Return: 13.04%

10 Year Average Return: 5.29%

Net Assets: 724.38 million

Major Holdings: Apple Inc, UnitedHealth Group Incorporated

Morningstar Return Rating: 2

Morningstar Risk Rating: 3

Expense Ratio: 2.12

9. Highland Premier Growth Equity Fund Class Y (HPEYX)

The fund invests in selected large and medium capitalization companies in the U.S.

Founded: 1996

5 Year Average Return: 14.38%

10 Year Average Return: 7.99%

Net Assets: 259.53 million

Major Holdings: Apple Inc, Visa Inc

Morningstar Return Rating: 5

Morningstar Risk Rating: 4

Expense Ratio: 0.88

10. Brown Advisory Flexible Equity Fund Advisor Shares (BAFAX)

It invests in large and medium capitalization companies, within the U.S., with long term growth potential.

Founded: 2007

5 Year Average Return: 13.08%

10 Year Average Return:

Net Assets: 299.11 million

Major Holdings: Visa Inc, Berkshire Hathaway Inc Class B

Morningstar Return Rating: 4

Morningstar Risk Rating: 2

Expense Ratio: 1.16

11. Bridgeway Large Cap Growth Fund (BRLGX)

The fund invests in large capitalization companies in the domestic market.

Founded: 2003

5 Year Average Return: 14.58%

10 Year Average Return: 7.41%

Net Assets: 169.00 million

Major Holdings: Apple Inc, Skyworks Solutions, Inc

Morningstar Return Rating: 4

Morningstar Risk Rating: 3

Expense Ratio: 0.81

12. Smith Group Large Cap Core Growth Fund Institutional Class (BSLGX)

Following Russell 1000 Growth Index, the fund chooses large capitalization companies to invest in.

Founded: 2007

5 Year Average Return: 12.94%

10 Year Average Return:

Net Assets: 62.39 million

Major Holdings: Starbucks Corporation, Kimberly-Clark Corporation Comm

Morningstar Return Rating: 4

Morningstar Risk Rating: 3

Expense Ratio: 0.79

As you can see, the mutual funds that have averaged 12% for the past five years have all been domestic growth mutual funds. So let’s think about this for a second. Where was the U.S. economy 5 years ago? In the tank. This means many, many domestic growth mutual funds (including index funds) did over 12% in the past 5 years. But the tricky part is finding funds that consistently average over 12%. It was important to include the 10-year return on these mutual funds to give you some context. Keeping above a 12% return is very difficult – especially through a recession.

But as you can see, there are mutual funds that have averaged 12% for the past five years. When you’ve heard Dave Ramsey harp on about this, he is correct. But for choosing mutual funds in the future, I recommend you pay more attention to historic returns, rather than short-term returns.