Aggressive Growth Fund


DEFINITION of 'Aggressive Growth Fund'

A mutual fund that attempts to achieve the highest capital gains. Investments held in these funds are companies that demonstrate high growth potential, usually accompanied by a lot of share price volatility. These funds are only for non risk-averse investors willing to accept a high risk-return trade-off.

Also commonly referred to as a "capital appreciation fund" or "maximum capital gains fund".

BREAKING DOWN 'Aggressive Growth Fund'

Aggressive growth funds have large betas, which means they have a large positive correlation with the stock market. They tend to perform very well in economic upswings and very poorly in economic downturns. An aggressive growth fund may also invest in a company's IPO and then quickly turn around and re-sell the same stock to realize large profits. Some aggressive growth funds also invest in options to boost returns.

  1. Option

    A financial derivative that represents a contract sold by one ...
  2. Growth Fund

    A diversified portfolio of stocks that has capital appreciation ...
  3. Initial Public Offering - IPO

    The first sale of stock by a private company to the public. IPOs ...
  4. Risk

    The chance that an investment's actual return will be different ...
  5. Mutual Fund

    An investment vehicle that is made up of a pool of funds collected ...
  6. Beta

    Beta is a measure of the volatility, or systematic risk, of a ...
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