When I think about mutual funds, size often catches my attention. The largest mutual funds attract billions of dollars because many investors trust them. But size isn’t everything. Still, understanding the biggest funds helps me gauge market trends and assess the most popular investment vehicles.
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What Does “Largest Mutual Fund” Mean?
The “largest” mutual funds are typically measured by their total assets under management. That’s the total market value of all shares investors hold in the fund.
Why does size matter?
- Liquidity: Larger funds often have easier liquidity.
- Stability: Big funds tend to be more stable during market volatility.
- Cost Efficiency: Economies of scale can lower expense ratios.
- Market Impact: Very large funds can influence markets.
But large size can sometimes lead to challenges like difficulty in managing smaller niche opportunities or higher transaction costs.
Table: 25 Largest Mutual Funds by Assets Under Management (AUM)
| Fund Name | Category | Assets Under Management (Billions USD) | Expense Ratio | Inception Year | Fund Manager(s) |
|---|---|---|---|---|---|
| Vanguard 500 Index Fund (VFIAX) | Large Blend | 750 | 0.04% | 1976 | Index Fund |
| Fidelity 500 Index Fund (FXAIX) | Large Blend | 320 | 0.015% | 1988 | Index Fund |
| Vanguard Total Stock Market (VTSAX) | Large Blend | 300 | 0.04% | 1992 | Index Fund |
| American Funds Growth Fund of America (AGTHX) | Large Growth | 110 | 0.65% | 1973 | Multi-manager |
| T. Rowe Price Blue Chip Growth (TRBCX) | Large Growth | 110 | 0.69% | 1993 | Larry Puglia |
| Fidelity Contrafund (FCNTX) | Large Growth | 130 | 0.85% | 1967 | Will Danoff |
| Dodge & Cox Stock Fund (DODGX) | Large Value | 70 | 0.52% | 1965 | Multiple |
| Vanguard Wellington Fund (VWELX) | Balanced | 60 | 0.25% | 1929 | Index + Active |
| American Funds Capital Income Builder (CAIBX) | Balanced | 30 | 0.57% | 1973 | Multi-manager |
| Fidelity Magellan Fund (FMAGX) | Large Blend | 20 | 0.75% | 1977 | Jeffrey Feingold |
| Vanguard Total Bond Market (VBTLX) | Intermediate-Term Bond | 180 | 0.05% | 1986 | Index Fund |
| PIMCO Total Return Fund (PTTRX) | Intermediate-Term Bond | 100 | 0.85% | 1987 | Bill Gross (former) |
| T. Rowe Price Equity Income (PRFDX) | Large Value | 50 | 0.64% | 1985 | Ron O’Hanley |
| Fidelity Low-Priced Stock Fund (FLPSX) | Mid-Cap Growth | 30 | 0.85% | 1978 | Steven Wymer |
| Vanguard Dividend Growth Fund (VDIGX) | Large Blend | 35 | 0.22% | 1990 | Janet Brown |
| American Funds New Perspective Fund (ANWPX) | World Growth | 80 | 0.64% | 1973 | Multi-manager |
| T. Rowe Price Growth Stock Fund (PRGFX) | Large Growth | 35 | 0.69% | 1987 | Larry Puglia |
| Fidelity Growth Company Fund (FDGRX) | Large Growth | 25 | 0.82% | 1963 | Will Danoff |
| Vanguard Health Care Fund (VGHCX) | Sector – Health | 40 | 0.35% | 1984 | Jean Hynes |
| Fidelity Select Technology Portfolio (FSPTX) | Sector – Tech | 20 | 0.70% | 1983 | Jeffrey Feingold |
| Vanguard Small-Cap Growth Fund (VISGX) | Small Growth | 15 | 0.28% | 1991 | Index Fund |
| American Funds Investment Company of America (AIVSX) | Large Blend | 90 | 0.62% | 1934 | Multi-manager |
| T. Rowe Price Small-Cap Value Fund (PRSVX) | Small Value | 10 | 0.87% | 1989 | William Stromberg |
| Fidelity OTC Portfolio (FOCPX) | Large Growth | 20 | 0.84% | 1983 | Will Danoff |
| Vanguard Balanced Index Fund (VBIAX) | Balanced | 25 | 0.07% | 1987 | Index Fund |
Why These Funds Became So Large
Some reasons these funds have grown massive include:
- Indexing: Vanguard and Fidelity index funds dominate with ultra-low fees attracting huge inflows.
- Longevity: Funds like the American Funds and Fidelity Contrafund have decades of track record.
- Strong Branding: Vanguard’s reputation for low fees, American Funds for active management.
- Consistent Performance: Many funds have outperformed peers and retained investors.
Impact of Size on Fund Performance
Large size can be a double-edged sword. On the positive side, large funds often benefit from:
- Lower expense ratios due to economies of scale.
- Better liquidity for investors.
- Stability during volatile markets.
However, very large funds sometimes face:
- Difficulty in nimble investing, especially for small or mid-cap stocks.
- Potential market impact when making trades.
When a fund grows huge, managers may shift toward large-cap stocks to deploy assets effectively.
Expense Ratios and Their Effect on Returns
Expense ratios reduce your net returns. Consider two funds:
| Fund Name | Gross Return | Expense Ratio | Net Return (Approximate) |
|---|---|---|---|
| Fund A | 10.5% | 0.85% | 9.65% |
| Fund B | 10.2% | 0.10% | 10.1% |
Over time, this difference compounds significantly.
Example Calculation: Effect of Expense Ratio on $100,000 Over 20 Years
Let’s calculate the future value of $100,000 invested at 10.5% gross return with 0.85% fees vs. 10.2% gross return with 0.10% fees:
\text{Net return Fund A} = 10.5% - 0.85% = 9.65% \text{Net return Fund B} = 10.2% - 0.10% = 10.1%Using the future value formula:
FV = P \times (1 + r)^nFor Fund A:
FV_A = 100,000 \times (1 + 0.0965)^{20} = 100,000 \times 6.63 = 663,000For Fund B:
FV_B = 100,000 \times (1 + 0.101)^{20} = 100,000 \times 6.73 = 673,000That’s a $10,000 difference over 20 years from just a 0.75% fee difference.
Manager Tenure and Its Importance
I look at how long the fund managers have been running the fund. Longer tenures usually signal stability and consistent strategy.
For example, Will Danoff has managed Fidelity Contrafund since 1990, which partly explains its sustained success.
How to Use This List
This list can help you:
- Identify popular funds with a long history and large investor base.
- Compare fees and strategies among major funds.
- Understand where investors are putting money in the US market.
- Consider if a fund’s size matches your investment goals and style.
Final Thoughts
The largest mutual funds offer many benefits — low costs, liquidity, and proven track records. But they also may have limits due to size constraints.
I recommend you balance size with your personal needs and preferences. Review fees, management, and strategy before investing.
