Top 5 Best Performing Small Cap Funds - Mutual Fund Commentary

Investors willing to increase the risk profile of their portfolios to receive higher returns would do well to consider small-cap funds. These funds have much higher potential because they generate significant demand driven sales during a rising market which pushes up prices. In addition, many smaller firms reinvest their gains back into their business. This reassures shareholders of improved performance and profit potential. With the advantage of widely diversified portfolios and expert management teams, mutual funds are the preferred choice to investing in small-cap stocks.

Below we will share with you the 5 best performing small-cap funds year to date. To view the Zacks Rank and past performance of all small-cap funds, then click here. 

John Hancock Small Cap Intrinsic Value A (JHIAX) seeks long term capital growth. A large portion of its assets are invested in small-cap companies within the capitalization range of the Russell 2000 index. Up to 35% of its assets are used to purchase foreign securities. The fund has a five year annualized return of 4.58%.

The fund manager is Timothy M. Malloy and he has managed this small-cap fund since 2005.

Alliance Bernstein Small-Mid Cap Value A (BIRMX) invests in equity securities of small and mid-cap domestic companies. At least 80% of its assets are invested in companies similar to those in the Russell 2500(TM) Value index and the greater of $5 billion or the market capitalization of the largest company in the Russell 2500(TM) Value index. It is a no-load fund.

This small-cap fund returned 214.91% over the last one year period.

Royce Opportunity Investment (RYPNX) seeks capital appreciation over the long term. It primarily invests in small and micro-cap companies with market capitalizations up to $2.5 billion. It uses 10% of its assets to purchase foreign securities and invests 65% of its assets in equity securities. The fund has a ten year annualized return of 8.71%. 

The small-cap fund has a minimum initial investment of $2,000 and an expense ratio of 1.22% compared to a category average of 1.50%.

Artio US Microcap A (JMCAX) invests heavily in domestic micro-cap companies. It focuses on investing in equity securities and related instruments. The companies invested in have a market cap within the capitalization range of the Russell 2000 or Russell Micro-cap indices. The fund returned 102.08% over the last one year period.

As of January 2010, this small-cap fund held 57 issues, with 3.56% of its total assets invested in Wet Seal A.

Nuveen NWQ Small Cap Value A (NSCAX) seeks long term capital growth. It invests the majority of its assets in equity securities of small companies. These firms must have market capitalizations similar to the firms in the Russell 200 index or the S&P SmallCap 600 Index. The fund returned 77.71% in the last one year period.

Phyllis G Thomas is the fund manager and he has managed this small-cap fund since 2004.

To view the Zacks Rank and past performance of all small-cap funds, then click here.

About Zacks Mutual Fund Rank

By applying the Zacks Rank to mutual funds, investors can find funds that not only outpaced the market in the past but are also expected to outperform going forward. Learn more about the Zacks Mutual Fund Rank at http://www.zacks.com/funds/mutualfund/

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