Mutual Fund Bowl 2006

This week's Rose Bowl pits a pair of undefeated college football powerhouses against each other, as the top-ranked USC Trojans and the second-ranked University of Texas Longhorns fight to determine the national champion. In honor of this mega-matchup, TheStreet.com has decided to usher in the Mutual Fund Bowl 2006.

Facing off in the inaugural Mutual Fund Bowl are two of the biggest and best-known mutual funds in the country: (AGTHX Quote) American Funds Growth Fund of America and the (FCNTX Quote)Fidelity Contrafund. And while neither team in this contest boasts a Heisman Trophy winner like Reggie Bush, both funds come complete with their own set of stars, even if they are fund managers searching for returns instead of scraping for yards.

Here's how the teams stack up...

Size Matters

At $124 billion in assets, the Growth Fund of America, or GFA, weighs in as the largest mutual fund in America. That's more than double the size of Contrafund, which currently boasts $58 billion in holdings.

Unlike in football, however, where possessing the larger set of linemen can be the key to victory, bigger does not always mean better in the fund world. Oversized funds often make it difficult for fund managers to establish and exit positions as easily as smaller, more nimble funds can. Bloated funds tend to pose more of a problem in the small-cap arena, where big buyers can quickly drive up share prices.

Both GFA and Contrafund veer toward large-cap companies, which are less affected by individual buying or selling pressure. The average market cap for a stock in the GFA is $30 billion, and in Contrafund $20 billion, which is why Morningstar slots them both in the "Large Growth" category. They may be better described as multi-cap, though, because nearly a quarter of Contrafund's 500-plus holdings, and just over 10% of GFA's 270 stocks are in mid-cap stocks in which a big buyer or seller can still exacerbate price swings.

In terms of concentration, GFA holds 16.6% of its assets in its top 10 holdings, the largest of which is Google(GOOG Quote) at 2.34%. Contrafund has just under 20% of its assets in its top 10, with the biggest being Canadian energy producer EnCana(ECA Quote) at 3.75%.

Edge: GFA. Morningstar analysts criticize both funds for being grossly overweight, but Contrafund's weight problem may be more hazardous to its health if mid-cap stocks lose steam in 2006.