William Lipovsky
Getting a 12% return on a mutual fund means you’re beating the stock market and will likely be able to retire comfortably.
To help you find these funds, we’ve researched annual returns to compile a list of mutual funds that have historically averaged around 12% or, in some cases, higher.
A few examples are the AB Growth Fund, the Alger Capital Appreciation Fund, and the American Funds Growth Fund of America.
For more details, see below.
The List of Mutual Funds That Have Averaged 12% Returns
Below, you’ll find the list of mutual funds that have averaged around 12% over the past five years, with some showing higher average returns over the past 10 years.
Our list is based on data from official fund websites Market Watch and Morningstar. The average returns, assets, expense ratios, and holdings were compiled from the most up-to-date data as of press time, updated December 2018.
AB Core Opportunities Fund, Class A (ADGAX)
- About: ADGAX invests in domestic companies of any size with long-term growth potential.
- Founded: 1999
- Five-year average return: 11.67%
- 10-year average return: 15.36%
- Net assets: About 1.3 billion
- Top holdings sectors: Technology and health care
- Morningstar return rating: 3
- Morningstar risk rating: 1
- Expense ratio: About 0.80%
- Find out more
AB Growth Fund, Class B (AGBBX)
- About: AGBBX invests in domestic companies of any size with long-term growth potential.
- Founded: 1987
- Five-year average return: 12.93%
- 10-year average return: 15.31%
- Net assets: About 10 million
- Top holdings sectors: Technology, health care, and consumer cyclical
- Morningstar return rating: 3
- Morningstar risk rating: 2
- Expense ratio: About 2%
- Find out more
AB Large Cap Growth Fund, Class R (ABPRX)
- About: ABPRX focuses mainly on the stocks of large domestic growth companies.
- Founded: 2003
- Five-year average return: 13.25%
- 10-year average return: 17.95%
- Net assets: About 69 million
- Top holdings sectors: Technology, health care, and consumer services
- Morningstar return rating: 4
- Morningstar risk rating: 2
- Expense ratio: About 1.25%
- Find out more
Alger Capital Appreciation Fund, Class A (ACAAX)
- About: ACAAX invests in U.S. stocks with long-term growth potential.
- Founded: 1996
- Five-year average return: 11.6%
- 10-year average return: 16.51%
- Net assets: About 1.25 billion
- Top holdings sectors: Technology and consumer cyclical
- Morningstar return rating: 4
- Morningstar risk rating: 3
- Expense ratio: About 1.25%
- Find out more
American Century Disciplined Growth Fund, Investor Class (ADSIX)
- About: ADSIX invests 99% of its capital in U.S. companies with more than $2 billion market capitalization.
- Founded: 2005
- Five-year average return: 10.01%
- 10-year average return: 15.37%
- Net assets: About 314 million
- Top holdings sectors: Technology, consumer cyclical, and health care
- Morningstar return rating: 3
- Morningstar risk rating: 2
- Expense ratio: About 1%
- Find out more
American Funds Growth Fund of America (AGTHX)
- About: AGTHX is a large capitalization fund that invests in primarily U.S. equities. This fund, in particular, is one Dave Ramsey often uses as an example of a fund that can earn 12% annually.
- Founded: 1973
- Five-year average return: 11.01%
- 10-year average return: 14.35%
- Net assets: About 85.5 million
- Top holdings sectors: Information technology and consumer discretionary
- Morningstar return rating: 3
- Morningstar risk rating: 2
- Expense ratio: About 0.60%
- Find out more
Bridgeway Large Cap Growth Fund (BRLGX)
- About: BRLGX invests in large-capitalization companies in the domestic market.
- Founded: 2003
- Five-year average return: 11.38%
- 10-year average return: 15.14%
- Net assets: About 280 million
- Top holdings sectors: Technology and health care
- Morningstar return rating: 3
- Morningstar risk rating: 3
- Expense ratio: About 0.80%
- Find out more
Brown Advisory Flexible Equity Fund, Advisor Shares (BAFAX)
- About: BAFAX invests in large and medium-capitalization companies, within the U.S., with long-term growth potential.
- Founded: 2007
- Five-year average return: 13.95%
- 10-year average return: 11.97%
- Net assets: About 4.5 million
- Top holdings sectors: Financial services and technology
- Morningstar return rating: 2
- Morningstar risk rating: 3
- Expense Ratio: About 1.15%
- Find out more
Thrivent Large Cap Growth Fund, Class A (AAAGX)
- About: AAAGX mainly invests in large-capitalization domestic companies, following indices like S&P 500, Russell 1000 Growth Index, etc.
- Founded: 1999
- Five-year average return: 11.07%
- 10-year average return: 14.27%
- Net assets: About 238 million
- Top holdings sectors: Technology and consumer cyclical
- Morningstar Return Rating: 3
- Morningstar risk rating: 3
- Expense ratio: About 1.20%
- Find out more
For more mutual fund options, see our article on mutual funds with the highest dividends.
As you can see, the mutual funds that have averaged 12% for the past five years have all been domestic growth mutual funds.
Returns on these funds can vary significantly based on the state of the U.S. economy. It can be difficult for funds to keep over a 12% return, particularly through a recession.
As such, keeping the economic forecast in mind when choosing your investments is essential.
Maria R. Riegger, Esq.
Erika Crawford
Cathy Desmet
Lindsey Desmet
Loren Eaton
What is the average of the S&P 500 during the same 5 and 10 years? Do those returns count the expense ratios and fees that diminish the returns?
Hello, Mike and Arianna! Good questions! The average returns listed in our article do account for the expense ratio, but not sales charges/fees. The S&P 500 averages were about 8.5% for the 5-year period and about 13% for the 10-year period, according to data from Yahoo! Finance.
Hello I’m very new to these investments & would like to know how to get started. What is the minimum amount allowed for this particular type of mutual fund
Hi Kymberli,
The specific minimum investment amount will depend on the financial institution use go through to invest in a mutual fund. Commonly, you’ll need at least $3,000. As a beginner, you should also keep an eye out for what fees are being charged on your investment. The financial institution will typically charge a small percentage of earning each year. Though the difference might seem small when its 1% versus 1.5%, it can add up quickly. You can try this fund analyzer tool to get a better idea of how fees will affect your investment. Also, the Securities and Exchange Commission has helpful information and guides about mutual funds. Good luck!
I am 58 years old and have been approved for SSI disability. I am currently receiving a pension and have an annunity of nearly $350,000. Should I take the annunity out in a lump sum and invest mutual funds?
Hi Paul,
This type of decision is always best made by talking to a financial advisor, as a number of factors must be considered.
Dave is a dope. Vanguard VOO beats most of these with low fees. Fees matter Dave!