Slideshow Top funds for the past 40 years

Published
  • January 23 2017, 4:01pm EST

If you have any clients retiring today, and they’ve had money working for the past 40 years, large caps were their best bet. Ideally, large-cap growth.

With all due respect to small-cap enthusiasts, high-yield fanatics or gold bugs, large caps have dominated a rollicking good ride from the late 1970s to today. These funds powered through good times and bad: sky-high inflation, bull markets, crashes and irrational exuberance. There were low points along the way, of course. That’s why we added both the best, and worst, annual performances for each fund, in addition to the 40-year annualized average.

Spoiler alert, the worst year for each one was 2008, the year of the financial crisis. The best year for 11 of 20 of these funds was either 1979 or 1980. But before you get too envious of the days of disco, bear in mind that the 30-year mortgage rate reached 16% in 1980, according to numbers from FreddieMac.

To be sure, a lot of funds aren’t eligible for this list. Any fund launched in the past 40 years obviously won’t be here, impressive gains notwithstanding. The biggest case in point: There are no ETFs on this list because they’re too new for our time frame in this analysis. The first ETFs made their appearance on the scene in the early 1990s.

So which funds have posted the best performance for the past 40 years? Scroll through to see the top 20. All data is from Morningstar.

20. American Century Select Inv

40-Yr Return: 12.57%
Best Year: 1980
Best Year Return: 45.76%
Worst Year: 2008
Worst Year Return: -39.67%
Fund assets (millions): $2,433
Expense Ratio: 0.99%

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19. Fidelity Contrafund

40-Yr Return: 12.65%
Best Year: 1991
Best Year Return: 54.92%
Worst Year: 2008
Worst Year Return: -37.16%
Fund assets (millions): $102,722
Expense Ratio: 0.70%

18. Nicholas

40-Yr Return: 12.65%
Best Year: 1991
Best Year Return: 41.98%
Worst Year: 2008
Worst Year Return: -31.57%
Fund assets (millions): $2,831
Expense Ratio: 0.72%

17. Mairs & Power Growth Inv

40-Yr Return: 12.68%
Best Year: 1995
Best Year Return: 49.32%
Worst Year: 2008
Worst Year Return: -28.51%
Fund assets (millions): $4,456
Expense Ratio: 0.65%

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16. Dodge & Cox Stock

40-Yr Return: 12.73%
Best Year: 2013
Best Year Return: 40.55%
Worst Year: 2008
Worst Year Return: -43.41%
Fund assets (millions): $61,600
Expense Ratio: 0.52%

15. Invesco Comstock

40-Yr Return: 12.85%
Best Year: 1979
Best Year Return: 47.72%
Worst Year: 2008
Worst Year Return: -35.89%
Fund assets (millions): $12,237
Expense Ratio: 0.84%

14. First Eagle Global

40-Yr Return: 12.85%
Best Year: 2003
Best Year Return: 37.64%
Worst Year: 2008
Worst Year Return: -21.06%
Fund assets (millions): $51,151
Expense Ratio: 1.10%

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13. T. Rowe Price New Horizons

40-Yr Return: 12.88%
Best Year: 1980
Best Year Return: 57.56%
Worst Year: 2008
Worst Year Return: -38.78%
Fund assets (millions): $16,742
Expense Ratio: 0.79%

12. American Century Growth Inv

40-Yr Return: 12.99%
Best Year: 1979
Best Year Return: 74.23%
Worst Year: 2008
Worst Year Return: -37.84
Fund assets (millions): $7,206
Expense Ratio: 0.98%

11. American Funds AMCAP

40-Yr Return: 13%
Best Year: 1979
Best Year Return: 51.93%
Worst Year: 2008
Worst Year Return: -37.68%
Fund assets (millions): $51,302
Expense Ratio: 0.67%

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10. Franklin Mutual Shares

40-Yr Return: 13.17
Best Year: 1979
Best Year Return: 40.48%
Worst Year: 2008
Worst Year Return: -37.92%
Fund assets (millions): $15,461
Expense Ratio: 0.79%

9. Royce Pennsylvania Mutual Invmt

40-Yr Return: 13.19%
Best Year: 1983
Best Year Return: 40.50%
Worst Year: 2008
Worst Year Return: -34.78
Fund assets (millions): $2,418
Expense Ratio: 0.92%

8. Sequoia

40-Yr Return: 13.43%
Best Year: 1997
Best Year Return: 43.20%
Worst Year: 2008
Worst Year Return: -27.03%
Fund assets (millions): $4,121
Expense Ratio: 1%

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7. T. Rowe Price Small-Cap Stock

40-Yr Return: 13.43%
Best Year: 1979
Best Year Return: 54.57%
Worst Year: 2008
Worst Year Return: -33.35%
Fund assets (millions): $9,432
Expense Ratio: 0.90%

6. Davis NY Venture

40-Yr Return: 13.46%
Best Year: 1980
Best Year Return: 43.91%
Worst Year: 2008
Worst Year Return: -40.03
Fund assets (millions): $11,806
Expense Ratio: 0.89%

5. Waddell & Reed Science & Tech

40-Yr Return: 13.55%
Best Year: 1999
Best Year Return: 102.93%
Worst Year: 2008
Worst Year Return: -33.25%
Fund assets (millions): $3,186
Expense Ratio: 1.27%

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4. American Funds Growth Fund of Amer

40-Yr Return: 13.87%
Best Year: 1979
Best Year Return: 45.72%
Worst Year: 2008
Worst Year Return: -39.07%
Fund assets (millions): $149,719
Expense Ratio: 0.66%

3. Columbia Acorn

40-Yr Return: 14.23%
Best Year: 1979
Best Year Return: 50.25%
Worst Year: 2008
Worst Year Return: -38.55%
Fund assets (millions): $4,813
Expense Ratio: 0.80%

2. Alger Spectra

40-Yr Return: 14.44%
Best Year: 1999
Best Year Return: 72.01%
Worst Year: 2008
Worst Year Return: -42.19%
Fund assets (millions): $5,104
Expense Ratio: 1.21%

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1. Fidelity Magellan

40-Yr Return: 14.80%
Best Year: 1980
Best Year Return: 69.94%
Worst Year: 2008
Worst Year Return: -49.40%
Fund assets (millions): $14,797
Expense Ratio: 0.83%