Until last quarter, large-cap growth funds were king of the hill.
Today the Daily Screen turns its attention to the fund category that has lorded over just about every other in recent years. Over the past two years, managers of many big-cap funds have loaded up on massive tech titans and ridden them to fat returns. The average large-cap growth fund boasts a tech weighting of more than 40% and has averaged 34% returns in each of the past two years, compared with 19.7% returns for the average
S&P 500 index fund, according to
Growth funds, as opposed to lower-octane value funds, typically focus on fast-growing companies that often sport steep
price-to-earnings ratios, like networking titan
Investors have noticed these returns, routinely stuffing billions into the category on a monthly basis. At the end of September there was about $575 billion invested in big-cap growth funds. That's more than any other flavor of stock fund.
But when tech stocks hit some bumps last quarter, large-cap growth funds followed suit. On average, they lost 0.5% for the quarter. That's not a big deal, but some investors might chafe after such a solid run.
As usual, we've screened the category for funds that beat their average peer over the past one- and three-year periods, according to
. The first chart lists the top 10, ranked by one-year return. Then check out the second chart, which gives the 10 stocks with the biggest weightings in those top-10 funds.
The list of top picks is, shall we say, tech heavy. A combined portfolio of the top-10 funds would have nearly 65 cents of every dollar invested in tech stocks, and the funds' top-nine combined picks are all tech stocks. No. 1 is network shop
, owned by every top large-cap growth fund as of their most recent portfolio reports. After an 836% return last year, the stock is up 8.6% since Jan. 1.
One indication that there may be some truth to the market's recent value- and financial-stock fetish is
toehold at No. 10. After a 70% gain last year, the financial behemoth is up 37% so far this year.