Growth-style funds

Growth-style funds

Growth-style funds are mutual funds that invest in companies with strong growth potential. These funds typically have a higher risk than other types of funds but can also offer higher returns. Growth-style funds are a good choice for investors willing to take on more risk to earn higher returns. 

Growth funds have made up most of the top-performing large-company stock funds over the past ten years. For instance, the top-performing large-company stock fund over the past 10 years is the Morgan Stanley Multi Cap Growth A (CPOAX). 

One major benefit of growth-style funds is that they tend to be less risky than other investment vehicles. This is because growth companies are typically well-established and have strong fundamentals. As such, their stock prices are less likely to be volatile and more likely to trend upwards over time. This makes them an ideal choice for investors looking to build long-term wealth. 

What are growth-style funds? 

Growth-style funds are mutual funds that seek to achieve capital appreciation by investing in companies with above-average growth potential. Growth companies are typically characterized by strong revenue and earnings growth and often have high price-to-earnings ratios.  

While growth stocks can be found in all sectors of the economy, they are most prevalent in the technology, healthcare, and consumer discretionary sectors.  

Growth funds are often high-risk, high-reward investments, making them ideal for market participants with long-term investment horizons and sound risk tolerance. 

Understanding growth-style funds 

Growth-style funds are typically more volatile than other types of mutual funds, but they also have the potential to generate higher returns over the long term. For this reason, growth funds are often appropriate for investors with a higher risk tolerance. If you are considering investing in a growth-style fund, it’s important to research the fund’s investment strategy and track record to ensure that it aligns with your investment goals. 

How do growth-style funds work? 

Growth-style funds are an investment vehicle that allows investors to gain exposure to a basket of growth-oriented stocks. These funds are typically managed by a team of investment professionals who carefully select stocks that they believe will outperform the market.  

Growth-style funds offer investors several benefits, chief among them being the ability to diversify their portfolios. By investing in a growth-style fund, investors can gain exposure to a wide range of stocks they may not have otherwise had access to. Additionally, these funds offer the potential for higher returns than more conservative investment vehicles.  

For these reasons, growth-style funds have become increasingly popular with investors in recent years. A growth-style fund may be the right investment if you want to add some growth potential to your portfolio. 

Types of growth-style funds 

There are three primary types of growth-style funds: large-cap, mid-cap, and small-cap.  

  • Large-cap funds  

Large-cap funds invest in established companies with 10 billion USD or more market capitalizations.  

  • Mid-cap funds 

Mid-cap funds invest in companies with 2 billion USD to 10 billion USD market capitalizations.  

  • Small-cap funds 

Small-cap funds invest in companies with less than 2 billion USD market capitalization. 

Growth funds tend to be more volatile than other types of funds, but they also have the potential to generate higher returns. Over the long term, growth funds have outperformed other types of funds but can also experience periods of underperformance. 


Example of Growth-style funds 

Investors should consider their risk tolerance and investment goals when choosing a growth fund.  

For example, a younger investor with a longer time horizon may be more willing to accept higher levels of risk in exchange for the potential for higher returns. An older investor who is getting close to retirement, on the other hand, could favor a more cautious growth fund with the possibility for moderate gains. 

Frequently Asked Questions

Corporations in a growth fund portfolio often experience more market growth and profitability. In contrast, companies in a value fund portfolio are more likely to experience lower sales and earnings but bigger dividend payments. A value fund could be less expensive to purchase than a growth fund due to the reduced cost of the equities that make up the fund. 

Growth-style funds are a type of mutual fund that invests in stocks of companies that are expected to experience above-average growth. These funds typically have a higher risk than other types of funds but also have the potential for higher returns. Growth-style funds are often appropriate for investors with a long-term investment horizon and a higher tolerance for risk. 

There are a few key differences between growth funds and equity funds.  

  • Firstly, growth funds tend to invest in growing companies, while equity funds can invest in a wider range of companies.  
  • Secondly, growth funds usually have a higher level of risk than equity funds, as they are investing in companies that may not be as established.  
  • Finally, growth funds tend to have a higher potential return than equity funds, as they invest in companies with high growth potential. 

In general, if you are investing with a long-term goal in mind, equity funds are preferred. The funds will also be able to handle market volatility better. 

Growth funds are the best option for investors who prefer long-term investments over short-term investments that provide income periodically. Growth funds do not distribute interim dividends; they only give capital gains. 

A growth mutual fund is a type of investment fund that seeks to achieve capital appreciation by investing in companies that are expected to experience above-average growth.  

Growth mutual funds typically invest in stocks but may also invest in other securities, such as bonds, real estate, and private equity. Growth mutual funds are often aggressive and take on more risk than other funds, such as value or income.  

Growth mutual funds are a popular choice for investors looking for long-term growth. Many growth funds are managed by professional money managers who carefully select the securities in the portfolio.  

While growth mutual funds can offer high returns, they also come with the risk of loss. Due to this, it is critical to conduct thorough research before investing in a growth fund

    Read the Latest Market Journal

    From $50 to $100: Unveiling the Impact of Inflation

    Published on Apr 12, 2024 21 

    In recent years, inflation has become a hot topic, evoking strong emotions as the cost...

    Japan’s Economic Resurgence: Unveiling the Tailwinds Behind Nikkei 225’s Record Leap

    Published on Apr 11, 2024 45 

    Source: eSignal, Intercontinental Exchange, Inc. In the heart of Japan’s economic landscape, the Nikkei 225...

    Weekly Updates 8/4/24 – 12/4/24

    Published on Apr 8, 2024 88 

      This weekly update is designed to help you stay informed and relate economic and...

    What Makes Forex Trading Attractive?

    Published on Apr 2, 2024 170 

    In a world where the click of a button can send goods across oceans and...

    Weekly Updates 1/4/24 – 5/4/24

    Published on Apr 1, 2024 93 

    This weekly update is designed to help you stay informed and relate economic and company...

    How to soar higher with Positive Carry!

    Published on Mar 28, 2024 123 

    As US Fed interest rates are predicted to rise 6 times this year, it’s best...

    Why 2024 Offers A Small Window of Opportunity and How to Position Yourself to Capture It

    Published on Mar 28, 2024 170 

    With the Federal Reserve (FED) finally indicating rate cuts in 2024, we witnessed a significant...

    Weekly Updates 25/3/24 – 29/3/24

    Published on Mar 25, 2024 73 

    This weekly update is designed to help you stay informed and relate economic and company...

    Contact us to Open an Account

    Need Assistance? Share your Details and we’ll get back to you


    This material is provided by Phillip Capital Management (S) Ltd (“PCM”) for general information only and does not constitute a recommendation, an offer to sell, or a solicitation of any offer to invest in any of the exchange-traded fund (“ETF”) or the unit trust (“Products”) mentioned herein. It does not have any regard to your specific investment objectives, financial situation and any of your particular needs. You should read the Prospectus and the accompanying Product Highlights Sheet (“PHS”) for key features, key risks and other important information of the Products and obtain advice from a financial adviser (“FA“) pursuant to a separate engagement before making a commitment to invest in the Products. In the event that you choose not to obtain advice from a FA, you should assess whether the Products are suitable for you before proceeding to invest. A copy of the Prospectus and PHS are available from PCM, any of its Participating Dealers (“PDs“) for the ETF, or any of its authorised distributors for the unit trust managed by PCM.  

    An ETF is not like a typical unit trust as the units of the ETF (the “Units“) are to be listed and traded like any share on the Singapore Exchange Securities Trading Limited (“SGX-ST”). Listing on the SGX-ST does not guarantee a liquid market for the Units which may be traded at prices above or below its NAV or may be suspended or delisted. Investors may buy or sell the Units on SGX-ST when it is listed. Investors cannot create or redeem Units directly with PCM and have no rights to request PCM to redeem or purchase their Units. Creation and redemption of Units are through PDs if investors are clients of the PDs, who have no obligation to agree to create or redeem Units on behalf of any investor and may impose terms and conditions in connection with such creation or redemption orders. Please refer to the Prospectus of the ETF for more details.  

    Investments are subject to investment risks including the possible loss of the principal amount invested. The purchase of a unit in a fund is not the same as placing your money on deposit with a bank or deposit-taking company. There is no guarantee as to the amount of capital invested or return received. The value of the units and the income accruing to the units may fall or rise. Past performance is not necessarily indicative of the future or likely performance of the Products. There can be no assurance that investment objectives will be achieved.  

    Where applicable, fund(s) may invest in financial derivatives and/or participate in securities lending and repurchase transactions for the purpose of hedging and/or efficient portfolio management, subject to the relevant regulatory requirements. PCM reserves the discretion to determine if currency exposure should be hedged actively, passively or not at all, in the best interest of the Products.  

    The regular dividend distributions, out of either income and/or capital, are not guaranteed and subject to PCM’s discretion. Past payout yields and payments do not represent future payout yields and payments. Such dividend distributions will reduce the available capital for reinvestment and may result in an immediate decrease in the net asset value (“NAV”) of the Products. Please refer to <> for more information in relation to the dividend distributions.  

    The information provided herein may be obtained or compiled from public and/or third party sources that PCM has no reason to believe are unreliable. Any opinion or view herein is an expression of belief of the individual author or the indicated source (as applicable) only. PCM makes no representation or warranty that such information is accurate, complete, verified or should be relied upon as such. The information does not constitute, and should not be used as a substitute for tax, legal or investment advice.  

    The information herein are not for any person in any jurisdiction or country where such distribution or availability for use would contravene any applicable law or regulation or would subject PCM to any registration or licensing requirement in such jurisdiction or country. The Products is not offered to U.S. Persons. PhillipCapital Group of Companies, including PCM, their affiliates and/or their officers, directors and/or employees may own or have positions in the Products. Any member of the PhillipCapital Group of Companies may have acted upon or used the information, analyses and opinions herein before they have been published. 

    This advertisement has not been reviewed by the Monetary Authority of Singapore.  


    Phillip Capital Management (S) Ltd (Co. Reg. No. 199905233W)  
    250 North Bridge Road #06-00, Raffles City Tower ,Singapore 179101 
    Tel: (65) 6230 8133 Fax: (65) 65383066