Mutual funds present a method for investors to participate in a diversified pool of stocks, bonds or other securities in a broad range of various asset classes to achieve specific investment goals. Each mutual fund made available to investors carries with it a specific investment objective, degree of risk and expense for ownership, all of which should be evaluated prior to purchasing shares. While there is a substantial number of mutual fund options for investors to select, some of these pooled investments stand out from the crowd. The top-rated mutual funds include the T. Rowe Price Health Sciences Fund, the Vanguard Consumer Staples Fund, the PIMCO Long-Term Credit Fund, the Fidelity Growth Company Fund and the T. Rowe Price Diversified Small Cap Growth Fund.

T. Rowe Price Health Sciences Fund (PRHSX)

The T. Rowe Price Health Sciences Fund is a sector-focused mutual fund that seeks capital appreciation over the long term. The fund's managers invest a substantial amount of fund assets in the common stock of both domestic and foreign companies engaged in the health care and life sciences fields, including companies involved in research, development, production, and distribution of health care products or services. The fund is not restricted to a specific market capitalization range, but it primarily invests in mid- and large-cap companies. 

It has an expense ratio of 0.76%, which is relatively low compared to other health care mutual funds. Investors do not pay upfront sales loads when purchasing shares or deferred sales charges when redeeming. However, a minimum investment of $2,500 is required.

Fidelity Growth Company Fund (FDGRX)

The Fidelity Growth Company Fund is a large-cap growth fund that seeks capital appreciation for the long term. Fund assets are typically invested in the common stock of large U.S. companies with growth tilt and low valuations. Fund managers have the ability to invest in bonds within the fund but generally focus on equity holdings for the majority of assets. The mutual fund invests heavily in large-cap domestic stocksThe fund's expense ratio of 0.87% is on par with the category average for large-cap mutual funds. Upfront and deferred sales loads are not imposed on investors, although a minimum initial investment of $2,500 is required for both qualified and nonqualified accounts.

T. Rowe Price Diversified Small Cap Growth Fund (PRDSX)

The T. Rowe Price Diversified Small Cap Growth Fund seeks to provide investors with capital appreciation by investing in small-cap companies included in the fund's benchmark, the MSCI U.S. Small Cap Growth Index. Fund managers utilize quantitative screens based on cash flow and return on equity (ROE) to determine which positions to maintain within the fund. The majority of the small-cap common stocks included in the fund are from U.S. companies, but the fund manager has the opportunity to invest in foreign equities in the small-cap market at his discretion. The fund has a relatively low expense ratio of 0.82% compared to similar mutual funds. No sales charges are assessed at the time of purchase or redemption, but a minimum investment of $2,500 for nonqualified accounts and $1,000 for IRAs is required.

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