In this article, we will look at the 10 Fastest Growing Mutual Funds in 2025.
It was a banner year for equity mutual funds as most outperformed, as the overall market climbed to record highs. Actively managed mutual funds with exposure to large-cap stocks stood out owing to the aggressive investment strategies that took advantage of emerging opportunities. The funds were up by an average of 30%. The outperformance came as big techs in the US posted double-digit gains in response to the artificial intelligence theme that drove markets to record highs.
Mutual funds with significant exposure to large-cap stocks, especially those with exposure to artificial intelligence, were some of the big winners. The mutual funds rose as a result of both better-than-expected US economic growth and ongoing excitement about the potential of artificial intelligence. On the other hand, mutual funds with exposure to small-cap stocks lagged the overall market as the focus remained on large-cap stocks, which delivered impressive financial results while backed by solid underlying fundamentals.
READ ALSO: 11 Best Lidar Stocks to Buy According to Hedge Funds and 10 Best Gold Stocks to Invest in for Portfolio Diversification.
After accounting for fees, data shows that the average actively managed mutual funds have returned 20% over the last year and 13% annually over the previous five years. Comparable passive funds have provided 14% and 23% returns, respectively. These active funds had an annual expense ratio of 0.45%, which was nine times greater than the benchmark-tracking funds’ equivalent of 0.05%.
Adam Benjamin, the 53-year-old who took charge of Boston-based Fidelity’s Select Semiconductors Portfolio mutual fund, continued to top the chart as one of the best-performing mutual fund managers. Benjamin came out on top for the second year in a row as his fund outperformed the 431 mutual or exchange-traded funds, producing a 49% return.
Amid the impressive performance, the emergence of exchange-traded funds with buzzy investment themes increasingly encroaches on the mutual funds landscape. A record number of mutual funds to ETF conversion last year underscored how ETFs are becoming increasingly popular at the expense of mutual funds.
The trend is expected to continue, with strategists at Bank of America foreseeing 400 mutual funds with $320 billion in assets converting into ETFs.
“Several fund providers needed to see proof of concept before they initiated their own conversions,” said Ryan Jackson, senior manager research analyst for Morningstar Research Services. “In many cases, the benefits of the ETF structure do more good than harm for investors.”
A change of tact was the catalyst behind investors pulling a record $450 billion out of actively managed mutual funds last year. While the pullout could be attributed to investors opting to lock in gains, a shift into cheaper index-tracking investment appears to be taking shape in the asset management industry. The withdrawals from stock-picking mutual funds also demonstrate the increasing popularity of exchange-traded funds (ETFs), which are listed on a stock exchange and provide many investors with more flexibility and US tax benefits.
The performance of traditional mutual funds has lagged behind the gains of Wall Street indices driven by large technology stocks, making it difficult for them to justify their comparatively high fees. As younger savers shift to less expensive passive strategies and older investors, who usually favor active strategies, cash out, the exodus from active strategies has accelerated.
“People need to invest to retire and at some point they have to withdraw,” said Adam Sabban, a senior research analyst at Morningstar. “The investor base for active equity funds skews older. New dollars are much more likely to make their way into an index ETF than an active mutual fund.”
Despite the growing conversions, mutual funds still remain a unique investment vehicle for investors eyeing diversified exposure in the market at some of the lowest fees. Low-fee, actively managed mutual funds are becoming increasingly popular owing to their ability to respond adequately to changing market sentiments and tweak holdings, therefore taking advantage of unique investment opportunities.
A portfolio manager using a laptop to research the performance of mutual funds and closed-ended funds.
Our Methodology
To make the 10 fastest growing mutual funds in 2025 we scanned the US market and settled on the top funds with an impressive record of returns. We then analyzed the funds focusing on why they stand out as the fastest growing mutual funds in 2025 and the investment strategy deployed by fund managers. Finally, we ranked the funds in ascending order based on their year to date return (as of February 17).
At Insider Monkey, we are obsessed with the stocks that hedge funds pile into. The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 275% since May 2014, beating its benchmark by 150 percentage points (see more details here).
10 Fastest Growing Mutual Funds in 2025
10. Fidelity Blue Chip Growth Fund (NASDAQ:FBGRX)
Ten year Gain: 17.95%
Year to Date Gain: 2.09%
Fidelity Blue Chip Growth Fund (NASDAQ:FBGRX) is one of the fastest-growing mutual funds that seek capital growth over the long term. By investing in blue chip companies, the mutual fund is able to gain exposure in some of the fastest-growing sectors, sure to shape the investment world for many years to come. The fund’s managers focus on fundamental analysis that ensures focus on companies with a competitive edge in their respective industries.
The managers also focus on the company’s financial condition and industry position in addition to analyzing economic conditions before investing. The aggressive fundamental analysis is the catalyst behind Fidelity Blue Chip Growth Fund’s 17.95% return over the past ten years. Additionally, Fidelity Blue Chip Growth Fund (NASDAQ:FBGRX) has generated a return of 2.09% year to date.
9. T. Rowe Price Small-Cap Value (NASDAQ:PRSVX)
Ten year Gain: 8.59%
Year to Date Gain: 2.46%
T. Rowe Price Small-Cap Value (NASDAQ:PRSVX) is one of the best mutual funds for investors eyeing exposure to undervalued small-cap companies. The mutual fund invests in small-cap companies backed by strong fundamentals and potential catalysts for value. As part of its diversification strategy, it invests in about 250 companies across various sectors, with 85% of holdings showing positive earnings surprises in 2024; portfolio positioning has been incredibly effective at spotting value opportunities.
Its total return over the past 10 years stands at 8.59%. The fund is also up by 2.46% for the year. With 85% of holdings showing positive earnings surprises in 2024, portfolio positioning has been incredibly effective at spotting value opportunities. Its 0.79% expense ratio is competitive for an active small-cap mutual fund.
8. Fidelity Advisor Series Equity Gr (NASDAQ:FMFMX)
Ten year Gain: 17.33%
Year to Date Gain: 3.65%
Fidelity Advisor Series Equity Gr (NASDAQ:FMFMX) is a mutual fund that pursues capital appreciation by investing 80% of its assets in equity securities. Fund managers invest in companies with above-average returns upon carrying out fundamental analysis. By pursuing investment opportunities in high-growth stocks, the mutual fund has generated a 17.33% return over the past ten years, making it one of the fastest-growing mutual funds in 2025.
Additionally, Fidelity Advisor Series Equity Gr (NASDAQ:FMFMX) has increased by about 3.65% year to date. The impressive performance comes from the company investing in high-growth companies that are leaders in their respective industries. For instance, it has significant exposure to artificial intelligence by investing in large-cap stocks like Nvidia, Microsoft and Meta platforms. Fidelity Advisor Series Equity also has significant exposure in healthcare and financial and communications services.
7. Vanguard 500 Index Fund (NASDAQ:VFIAX)
Ten year Gain: 13.28%
Year to Date Gain: 4.11%
Vanguard 500 Index Fund (NASDAQ:VFIAX) is a mutual fund tailored for investors seeking broad stock market exposure. The fund primarily tracks the performance of the S&P 500 by investing in some of the index’s most significant holdings. Therefore, it is a highly diversified mutual fund based on its holdings in technology consumer cyclical financials, healthcare and industrial sectors.
The mutual fund employs an indexing investment approach. It also tries to replicate the target index performance by investing in all, or substantially all, of its assets in the stocks that make up the index. It also holds each stock for approximately the same proportion as the index. Vanguard 500 Index Fund (NASDAQ:VFIAX) has consistently outperformed the S&P 500. Over the past 10 years, it has generated a total return of 13.28% compared to 11.99% for the index over the same period. The fund is also up by 4.11% for the year.
6. Schwab S&P 500 Index (NASDAQ:SWPPX)
Ten year Gain: 13.27%
Year to Date Gain: 4.11%
Schwab S&P 500 Index (NASDAQ:SWPPX) stands out as one of the best mutual funds for investors looking to track the performance of the S&P 500. The mutual fund invests in each of the companies in the S&P 500 index and does not seek to outperform it but replicate its performance. Additionally, the fund stands out owing to its low expense ratio of 0.02%, which ensures investors have an optimum return on their investment.
In addition, the Schwab S&P 500 Index (NASDAQ:SWPPX) does not have a minimum investment requirement, making it accessible to all investors. While the fund is up by about 4.11% year to date, it has generated a 13.27% return over the past ten years, outperforming the underlying index that is up by 11.99% over the same period.
5. BNY Mellon Large Cap Securities Fund (NASDAQ:DREVX)
Ten year Gain: 14.12%
Year to Date Gain: 4.78%
BNY Mellon Large Cap Securities Fund (NASDAQ:DREVX) seeks to create a broadly diversified portfolio of growth and value stocks. The mutual fund invests in large-cap companies, upon managers conducting fundamental analyses to identify companies with solid underlying fundamentals. While investing for the long term, the fund seeks capital appreciation while focusing on growth companies.
Fund managers invest in companies with significant growth opportunities and sustainable competitive advantages. They also focus on companies with attractive valuations that make it possible to generate optimum value in the long term. BNY Mellon Large Cap Securities Fund’s (NASDAQ:DREVX) diversified portfolio and focus on high-growth companies is the catalyst behind its 14.12% return over the last ten years. Additionally, it’s also up by 4.78% year to date. The fund may borrow up to one-third of its total assets, including assets acquired with borrowed funds, to capitalize on investment opportunities.
4. Shelton Nasdaq-100 Index Investor (NASDAQ:NASDX)
Ten year Gain: 17.99%
Year to Date Gain: 5.24%
Shelton Nasdaq-100 Index Investor (NASDAQ:NASDX) is a top mutual fund for investors looking to diversify their investments in non-financial firms. The mutual fund allocates at least 80% of its resources to large-cap growth stocks listed on the Nasdaq 100 Index. Consequently, it is an ideal investment tool for investors eyeing exposure to technology and biotech companies.
As one of the fastest growing mutual funds, Shelton Nasdaq-100 Index Investor (NASDAQ:NASDX) boasts of an impressive track record, with a 17.99% return over the last ten years. Additionally, it is up by about 5.24% year to date, outperforming most mutual funds. The impressive performance stems from the fact that the mutual fund invests in stocks that are likely to beat their respective categories. While passively managed, the fund relies on fundamental analysis to discover high-growth opportunities in the Nasdaq 100 Index.
Some of the mutual funds’ biggest holdings, including Nvidia, Microsoft, and Amazon, are spearheading the artificial intelligence race. Additionally, the mutual fund boasts of a much lower expense ratio of 0.51%, allowing investors to lock in optimum returns.
3. American Funds Growth Fund of Amer A (NASDAQ:AGTHX)
Ten year Gain: 14.04%
Year to Date Gain: 6.66%
American Funds Growth Fund of Amer A (NASDAQ:AGTHX) is a unique mutual fund that deploys multi-manager systems. Its managers independently run a portion of the fund’s assets, whereby they are able to combine diverse investment perspectives while focusing on high-quality growth companies. Over the last ten years, the fund’s team of twelve portfolio counsellors has produced excess returns of 2.1% per year over its benchmark. The strategy of using multiple portfolio counsellors has produced better risk-adjusted returns.
American Funds Growth Fund of Amer A (NASDAQ:AGTHX) has generated an average annual return of 14% over the past ten years. Likewise, it is up by about 6.66% year to date and returned 14.04% over the past 10 years, affirming why it is one of the fastest-growing mutual funds in 2025. In addition to solid returns, the fund’s competitive edge stems from its low expense ratio of 0.62%, given the active management strategy.
2. Fidelity China Region (NASDAQ:FHKCX)
Ten year Gain: 6.92%
Year to Date Gain: 8.02%
Fidelity China Region (NASDAQ:FHKCX) is a top mutual fund that is used to gain exposure to the Chinese economy. The mutual fund invests 80% of its assets in securities tied to the Chinese, Hong Kong and Taiwanese economies. While the fund primarily invests in stocks, technology companies account for 33% of the portfolio, with the Consumer cyclical accounting for 23.9% and the Communication Service sector at 13.2%.
Fund managers leverage fundamental analysis to identify value investment opportunities in various sectors tied to the Chinese economy. Consequently, Fidelity China Region (NASDAQ:FHKCX) focuses on the company’s financial conditions and industry position to identify solid high-value investment opportunities. While the Fidelity China Region has returned 6.92% over the past 10 years, it is up by about 8.02% year to date as it benefits from a recovery of the Chinese economy amid a string of economic stimuli.
1. Fidelity Contrafund (NASDAQ:FCNTX)
Ten year Gain: 15.88%
Year to Date Gain: 8.22%
Fidelity Contrafund (NASDAQ:FCNTX) is one of the fastest-growing mutual funds, with an 8.22% gain year to date. Additionally, the fund has generated an average return of 15.88% over the past ten years. The fund has produced an alpha of 2.9% annually over the S&P 500, outperforming its benchmark in 24 of the last 32 years. Its competitive edge stems from relying on growth-oriented strategies that focus on companies with underappreciated earnings potential. Therefore, it invests in undervalued companies based on earnings with the prospects of rallying.
Additionally, mutual funds are highly diversified by investing in companies stocks in various sectors as one of the ways of spreading the risk. While it invests in about 3000 companies, it isn’t very objective toward large-cap growth companies that command a competitive edge in their respective fields with tremendous opportunities for growth. Fidelity Contrafund’s (NASDAQ:FCNTX) in-house research methodology has regularly spotted up-and-coming growth leaders early. This includes key positions in Meta and Nvidia prior to their huge runs.
While we acknowledge the potential of the mutual fund Fidelity China Region (NASDAQ:FHKCX) to grow, our conviction lies in the belief that AI stocks hold greater promise for delivering higher returns and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than FHKCX but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
READ NEXT: 20 Best AI Stocks To Buy Now and Complete List of 59 AI Companies Under $2 Billion in Market Cap.
Disclosure: None. Insider Monkey focuses on uncovering the best investment ideas of hedge funds and insiders. Please subscribe to our free daily e-newsletter to get the latest investment ideas from hedge funds’ investor letters by entering your email address below.
