10 funds that beat the S&P 500 by over 20% in 2023 - Fund Selector Asia (2024)
A standout year of strong returns for US equities would have been a surprise to many market participants at the start of 2023, since a recession was widely anticipated by economists at the time.
This is because when the US Federal Reserve continued to raise interest rates to combat inflation over the course of 2023, it not only reduced stock valuations, but also increased the likelihood of an economic slowdown.
So, when the S&P 500 index finished the year with a 26.29% return, many active fund managers might have been caught off guard.
Out of 282 funds available for distribution in Singapore with at least a one-year track record, less than half managed to beat the S&P 500 index.
Even fewer strategies (16) managed to beat the Russell 1000 Growth index return of 42.68% – another widely used benchmark favored by growth fund managers. None outperformed the NASDAQ 100 index return of 55.13%.
However, 10 actively managed strategies stood out last year with returns more than 20 percentage points above the S&P 500 index. Below are the 10 strategies, according to data compiled from FE fundinfo.
Fund
2023 performance (%)
3yr performance (%)
5yr performance (%)
PGIM Jennison US Growth
53.47
4.17
114.9
BlackRock GF US Growth
52.68
6.37
92.91
MS INVF US Insight
52.26
-47.18
34.65
Sands Capital US Select Growth Fund
51.3
-20.88
76.97
Natixis Loomis Sayles US Growth Equity
49.56
26.07
111.67
T. Rowe Price US Blue Chip Equity
49.54
5.81
81.57
MS INVF US Growth
49.29
-40.36
62.08
New Capital US Growth
48.68
17.87
N/A
T. Rowe Price US Large Cap Growth Equity Fund
48.64
12.71
98.92
Baillie Gifford Worldwide US Equity Growth
46.58
-40.55
N/A
Most of the best performing were those that suffered heavily during the difficult year of 2022 where most asset classes slumped as the Fed embarked on its interest rate hiking cycle.
The highest performing fund in the list was the $116m PGIM Jennison US Growth fund, managed by Blair Boyer, Natasha Kuhlkin and Kathleen McCarragher.
The strategy was up 53.47% in 2023, after a 39.83% loss in 2022. Over a five-year period ending 2023, the strategy was up 114.9% versus a 107.21% return from the S&P 500 index.
The fund benefitted from its underweight position in Apple, which lagged the performance of the other big tech companies last year, and an overweight position in Eli Lilly, which performed exceptionally well on the back of its popular selling obesity drug.
The second highest performing fund in the list was the $395m BlackRock US Growth fund, managed by Phil Ruvinsky and Caroline Bottinelli.
The strategy was up 52.68% last year, after a 40.57% loss in 2022. Over a five-year period ending 2023, the strategy was up 92.91% – lagging the S&P 500 index return of 107.21%.
However last year the fund benefitted from its overweight positions in semiconductor firms Nvidia, Broadcom and Cadence Design Systems – all of which were up significantly in 2023.
Another notable fund in the list is the $3.1bn Natixis Loomis Sayles US Growth Equity fund, managed by Aziz Hamzaogullari.
The strategy was up 49.56% last year, following a 28.2% loss in 2022 – a relatively lower loss compared with funds in the list above. Over a five-year period ending 2023, the strategy was up 111.67%.
The fund has benefitted from its overweight positions in Nvidia, Tesla, Alphabet and Meta which all performed well in 2023.
One strategy, the T. Rowe Price Blue Chip Growth ETF (TCHP), has done just that. The active ETF has proved itself as one of the top active ETFs in 2024, outperforming the S&P 500 in 2023 and so far year-to-date (YTD). TCHP has returned 11.7% YTD per YCharts, compared to 7.4% for the S&P 500.
One strategy, the T. Rowe Price Blue Chip Growth ETF (TCHP), has done just that. The active ETF has proved itself as one of the top active ETFs in 2024, outperforming the S&P 500 in 2023 and so far year-to-date (YTD). TCHP has returned 11.7% YTD per YCharts, compared to 7.4% for the S&P 500.
VOO - Expense Ratio Comparison. FNILX has a 0.00% expense ratio, which is lower than VOO's 0.03% expense ratio. Despite the difference, both funds are considered low-cost compared to the broader market, where average expense ratios usually range from 0.3% to 0.9%.
SPY, VOO and IVV are among the most popular S&P 500 ETFs. These three S&P 500 ETFs are quite similar, but may sometimes diverge in terms of costs or daily returns. Investors generally only need one S&P 500 ETF.
As the chairman of Berkshire Hathaway, Buffett has consistently outperformed the S&P 500 for decades, and in the process has become one of the world's richest men. (Forbes puts his net worth at $37 billion.) Despite his fortune, Buffett is known for living a modest lifestyle, by billionaire standards.
Berkshire Hathaway: Has historically outperformed the S&P 500 over the long term under Warren Buffett's leadership. However, past performance doesn't guarantee future results.
Somewhat surprisingly, Buffett does not recommend Berkshire stock. Instead, he has consistently told investors to buy an S&P 500 index fund. "I recommend the S&P 500 index fund, and have for a long, long time to people.
The Vanguard High-Yield Corporate Fund is the company's top performing bond fund over the past decade. It features a high-yield, intermediate-term fixed income portfolio.
In the past year, QQQ returned a total of 36.87%, which is significantly higher than VOO's 28.17% return. Over the past 10 years, QQQ has had annualized average returns of 18.47% , compared to 12.69% for VOO. These numbers are adjusted for stock splits and include dividends.
I put my personal 401(k) and a lot of my mutual fund investing in four types of mutual funds: growth, growth and income, aggressive growth, and international. I personally spread mine in 25% of those four. And I look for mutual funds that have long track records that have outperformed the S&P.
Mutual funds come with a variety of objectives and strategies, and there are many more options than with index funds to customize how you want to invest.
The best performing Sector in the last 10 years is Information Technology, that granded a +19.94% annualized return. The worst is Energy, with a +4.01% annualized return in the last 10 years.
Investors looking for ETFs that have beaten both the S&P 500 and the Nasdaq Composite over the last year have come to the right place. Here's a closer look at the Vanguard Growth ETF (VUG -0.06%), Vanguard Mega Cap Growth ETF (MGK 0.05%), and the Vanguard Communications Services ETF (VOX -0.21%).
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