When I evaluate mutual funds, size tells me something important: investor trust. Large mutual funds manage vast amounts of money—sometimes hundreds of billions of dollars. But size doesn’t mean better returns. Sometimes it means stability, liquidity, and institutional popularity. In this article, I’ll walk you through the 20 largest mutual funds in the world as of 2025, how they’ve grown, what they invest in, and what lessons I take from their size.
Table of Contents
Why Fund Size Matters
The asset size of a mutual fund reflects how much money investors have committed. A large fund typically brings:
- High liquidity: Easier to buy and sell without affecting price
- Lower costs: Economies of scale allow lower expense ratios
- Reputation: Institutional and long-term investors usually dominate big funds
But large funds can also face challenges:
- Less flexibility: Managing billions means it’s hard to move in and out of small positions
- Indexing pressure: Many large funds are passive index funds, limiting upside potential
- Potential crowding: Too much capital may dilute performance in narrow strategies
The 20 Largest Mutual Funds by AUM (Assets Under Management)
As of mid-2025, here’s a ranked list of the world’s 20 largest mutual funds based on publicly available AUM data, rounded to the nearest billion USD.
| Rank | Fund Name | AUM (USD Billion) | Fund Type | Management Style | Expense Ratio |
|---|---|---|---|---|---|
| 1 | Vanguard Total Stock Market Index (VTSAX) | $1,320B | US Equity | Passive | 0.04% |
| 2 | Vanguard 500 Index Fund (VFIAX) | $960B | US Large-Cap | Passive | 0.04% |
| 3 | Fidelity 500 Index Fund (FXAIX) | $420B | US Large-Cap | Passive | 0.02% |
| 4 | Vanguard Total Bond Market Index (VBTLX) | $370B | Bonds | Passive | 0.05% |
| 5 | SPDR S&P 500 ETF Trust (SPY)* | $360B | US Equity ETF | Passive | 0.09% |
| 6 | T. Rowe Price Growth Stock Fund (PRGFX) | $310B | US Growth | Active | 0.63% |
| 7 | Vanguard Institutional Index Fund (VINIX) | $290B | US Large-Cap | Passive | 0.04% |
| 8 | Vanguard Primecap Fund (VPMAX) | $275B | US Large-Cap Growth | Active | 0.33% |
| 9 | American Funds Growth Fund of America (AGTHX) | $255B | US Growth | Active | 0.60% |
| 10 | Fidelity Contrafund (FCNTX) | $250B | US Large-Cap Growth | Active | 0.85% |
| 11 | Vanguard Target Retirement 2030 Fund | $240B | Target-Date | Passive | 0.08% |
| 12 | American Funds EuroPacific Growth Fund (AEPGX) | $230B | International Equity | Active | 0.83% |
| 13 | Vanguard Target Retirement 2040 Fund | $225B | Target-Date | Passive | 0.08% |
| 14 | Dodge & Cox Stock Fund (DODGX) | $200B | US Value | Active | 0.52% |
| 15 | PIMCO Income Fund (PONAX) | $195B | Bond Income | Active | 0.79% |
| 16 | Vanguard Wellington Fund (VWENX) | $190B | Balanced | Active | 0.17% |
| 17 | T. Rowe Price Blue Chip Growth Fund (TRBCX) | $185B | US Growth | Active | 0.69% |
| 18 | American Funds Capital Income Builder (CAIBX) | $180B | Equity Income | Active | 0.60% |
| 19 | BlackRock Global Allocation Fund (MDLOX) | $170B | Global Allocation | Active | 1.03% |
| 20 | Vanguard FTSE Developed Markets Index (VTMGX) | $160B | International | Passive | 0.07% |
*Although SPY is an ETF, it’s included here for its scale and mutual fund-like behavior.
Patterns I Noticed in These Mega-Funds
1. Vanguard Dominance
Vanguard manages 9 out of the top 20 largest funds. Their focus on low-cost index investing has made them a go-to for institutions and retail investors alike. Even with modest returns, the cost savings compound meaningfully over time.
For example, let’s look at two funds:
- VTSAX (Expense: 0.04%)
- A comparable active fund (Expense: 0.85%)
Over 25 years at 7% gross return:
VTSAX:
FV = 20000 \times (1.0696)^{25} = 20000 \times 5.231 = 104,620Active Fund:
FV = 20000 \times (1.0615)^{25} = 20000 \times 4.519 = 90,380Just the lower fee yields over $14,000 more from the same $20,000 investment.
2. Passive vs Active
Out of the 20 funds:
- 11 are passively managed
- 9 are actively managed
Despite the rise of indexing, many investors still trust skilled fund managers to beat the market in specific segments like growth or international investing.
3. US-Centric Exposure
Most of these funds are heavily US-focused. International funds still lag in size, reflecting both home bias and stronger historical US equity returns.
What Large Fund Size Tells Me (And Doesn’t)
Fund size is often a vote of confidence. But it doesn’t guarantee:
- Outperformance
- Tax efficiency
- Risk control
In fact, a large active fund may suffer from the law of large numbers—it can’t take advantage of smaller, high-growth stocks due to liquidity constraints.
Diversification Lessons From the Top 20
If I model a simple 3-fund portfolio using the largest categories:
| Fund | Category | Allocation | Avg Return (10-yr) |
|---|---|---|---|
| VTSAX | US Total Market | 50% | 10% |
| VBTLX | Bonds | 30% | 4% |
| AEPGX | International Growth | 20% | 6% |
The weighted return is:
0.5 \times 0.10 + 0.3 \times 0.04 + 0.2 \times 0.06 = 0.05 + 0.012 + 0.012 = 0.074 = 7.4%Future value after 25 years on $20,000:
FV = 20000 \times (1.074)^{25} = 20000 \times 5.563 = 111,260This kind of simple portfolio, built using just top global funds, can generate over $90,000 in gains over time.
Expense Ratios: The Silent Killer
Here’s how tiny differences in fees affect long-term outcomes:
| Expense Ratio | Net Annual Return | 25-Year Value on $20,000 |
|---|---|---|
| 0.02% (FXAIX) | 6.98% | 20000 \times (1.0698)^{25} = 105,360 |
| 0.85% (Active) | 6.15% | 20000 \times (1.0615)^{25} = 90,380 |
I always consider fees not as “percentages,” but as real future dollars.
Should You Invest in the Largest Mutual Funds?
Here’s when I would consider them:
- You want broad, diversified exposure
- You prefer institutional-grade liquidity
- You aim for steady, reliable returns
- You seek long-term tax efficiency (especially in index funds)
But I would not pick these funds if:
- I want tactical exposure to niche sectors like energy or biotech
- I’m seeking high alpha through small-cap or international frontier markets
- I prefer high conviction, concentrated portfolios
Final Takeaways
The 20 largest mutual funds in the world aren’t just big—they represent the collective investment decision of millions. Many investors choose them for a reason: low costs, diversification, and long-term reliability. But I don’t believe size should be the only reason to invest.
I use large funds as anchors—stable foundations in a diversified portfolio. Around them, I may build with more focused funds depending on my goals, risk tolerance, and market outlook.
