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U.S. News evaluated 464 Large Growth Funds. Our list highlights the top-rated funds for long-term investors based on the ratings of leading fund industry researchers.
The fund has returned 33.31 percent over the past year, 19.03 percent over the past three years, 21.53 percent over the past five years, and 9.79 percent over the past decade.
|Trailing Returns||Updated 06.30.2014|
|Year to date||7.6%|
|3 Years (Annualized)||19.0%|
|5 Years (Annualized)||21.5%|
|10 Years (Annualized)||9.8%|
Investors in the USAA Nasdaq-100 Index Fund have been on quite the ride lately.
As of July 03, 2014, the fund has assets totaling almost $539.20 million invested in 103 different holdings. Its portfolio consists primarily of large-cap stocks.
The fund uses an indexing strategy to replicate the returns of the Nasdaq-100 Index. The Nasdaq-100 Index is comprised of 100 of the largest non-financial companies listed on the Nasdaq. In 2008, when the banking industry imploded, one would have thought that this fund, by its avoidance of the financial sector, would have been spared some pain. But that wasn't the case, particularly since the fund's underlying index, much like the broader Nasdaq, is heavy on tech companies that also saw deep losses during the downturn. In 2008, the fund shed 42 percent as its three largest holdings--Apple, Microsoft, and Google--all took a nosedive. The fund's performance is particularly tied to that of Apple, which at the moment represents a whopping 19 percent of its portfolio. Apple has enjoyed a steady run up in recent years. Similarly, this fund has rebounded strongly, staying far ahead of its peers since 2009. Notably, despite its dismal performance in 2008, the fund's trailing three-year returns still land it (as of the end of October) in the top 10 percent of Morningstar's large growth category. The fund has returned 33.31 percent over the past year and 19.03 percent over the past three years.
While this fund certainly has plenty going for it, good timing isn't among its defining characteristics. The fund launched in late 2000, just months after the dot-com bubble burst. That made for a dismal start, with the fund losing 33 percent in 2001 and 38 percent in 2002 as the technology sector foundered. The fund's long-term track record still carries the weight of that terrible start. Still, one advantage for long-term investors is the fund's low fees. As a result of its passive management, the fund charges 0.78 percent per year, which compares favorably to the 1.35 percent average among all funds in Morningstar's large growth category. Even so, it's not quite as cheap as the First Trust NASDAQ-100 Equal Weight Index Fund, a comparable ETF that charges 0.60 percent per year. The USAA Nasdaq-100 Index Fund has returned 21.53 percent over the past five years and 9.79 percent over the past decade.
The fund uses an indexing strategy to replicate the returns of the Nasdaq-100 Index. The fund owns all 100 stocks that comprise its benchmark.
Role in Portfolio
The fund could lend support to a well-balanced portfolio.
Brent Reeder oversees the fund.
USAA Nasdaq 100 Index Fund has an expense ratio of 0.64 percent.
When tech stocks struggle, this fund is likely to feel the pain in an acute fashion.