Top Goldman Sachs Fund Topped The S&P 500 Over Periods Long, Short (2024)

The $1.5 billion Goldman Sachs Large Cap Growth Insights Fund (GCGIX) is one of the best mutual funds. It earned that distinction by over time periods long and short, including this year going into Dec. 22.

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Fund management says their investment approach mixes "fundamental research and a variety of quantitative techniques."

The fund applies that approach to find, among other things, stocks whose prices do not reflect what the fund believes are their true value. Basically, the fund is looking for underpriced stocks.

The fund is managed by Goldman Sachs Asset Management's quantitative investment strategies team. The fund's portfolio managers are Osman Ali and Len Ioffe.

Best Mutual Funds: High Turnover

The fund is not shy about executing on its approach. Its latest annualized turnover ratio is 218%, according to Morningstar Direct. The average turnover ratio for U.S. stock mutual funds is 66%.

The results of their stock picking based on fundamentals and quant number crunching are clear enough. Their top holdings as of Nov. 30 included familiar, popular large-cap stocks Microsoft (MSFT), Apple (AAPL), Alphabet (GOOG), Amazon.com (AMZN) and Meta Platforms (FB), formerly known as Facebook.

Other top holdings are PayPal (PYPL), Nvidia (NVDA) and Tesla (TSLA).

And the fund's top-five holdings reflect conviction. Weights range from 4% for Tesla up to 10.2% for Apple.

Familiar CAN-SLIM Names

CAN-SLIM investors will also see familiar names here. Among its 103 holdings, five were recent members of the IBD Leaderboard. Another six were part of the IBD 50.

Leaderboard is IBD's curated list of leading stocks that stand out for their technical and fundamental prospects. The IBD 50 is IBD's flagship screen of leading growth stocks that show strong relative price strength and top-notch fundamentals.

Holdings on the Leaderboard include computer chip designer Nvidia and electric vehicle and battery maker Tesla.

Holdings in the IBD 50 include Broadcom (AVGO) and Edwards Lifesciences (EW).

Tesla Helped Steer Portfolio Into Best Mutual Funds

Look more closely at some holdings. How does Tesla help this portfolio aim for performance that will keep it among the best mutual funds?

The automaker's share of the total U.S. electric vehicle (EV) market fell to 66.3% as of the end of the second quarter from 79.5% a year earlier, according to Experian's Automotive Market Trends Review.

That happened amid growth in the overall EV market. Most of that was achieved by other car makers. But Tesla is gaining share in the luxury EV car sales, says greencarreports.com.

Tesla shares have soared 240% vs. the S&P 500's 29% over the past 24 months.

They're up 33% this year.

Broadcom Is Looking Up

What is Broadcom's role in Large Cap Growth's push to be one of the best mutual funds?Broadcom designs analog integrated circuits for the telecommunication, industrial, automotive and computing markets. It gapped up on Dec. 10 as its January-quarter revenue guidance topped expectations by analysts.

The semiconductor and infrastructure software firm also announced a new $10 billion stock buyback.

Fourth-quarter earnings rose 23% to $7.81 a share. Estimates had been $7.74. Revenue climbed 15% to $7.41 billion, topping estimates of $7.35 billion.

For the current quarter ending in January, Broadcom said it expects revenue of $7.6 billion. That would be 14% higher than a year earlier. Analysts had predicted 9% revenue growth.

The stock has returned 51% this year. Its dividend yield is 2.5%.

Edwards Boosts Fund's Prognosis

Edwards Lifesciences helps keep this Goldman Sachs' portfolio's goal to be one of the best mutual funds alive.

The company develops products to treat cardiovascular disease. Its products include replacement heart valves and transcatheter heart valves.

Edwards is a relative newcomer to the IBD 50. Just before its addition, on Dec. 17, it gained 2% on a day when the Dow fell more than 500 points. That strength in the face of headwinds is a bullish indicator, IBD reported.

It has IBD's SMR Rating of A. SMR stands for Sales + profit Margins + Return on equity. More specifically, the Rating combines a company's sales growth rate over the last three quarters, pretax profit margins, after-tax profit margins, and ROE.

The Rating combines four fundamental factors into one simple "A" to "E" rating system. A is best and E is worst.

It also has a strong IBD Composite Rating of 93.

A Composite Rating of 93 means that a stock is in the top 7% of all stocks on a number of technical and fundamental factors, including both price performance and earnings. The best way to use the Composite Rating is to watch for stocks that have 90-plus scores and are forming basesor are infollow-on buy areas. That way, you spot the best-positioned stocks before they start big price runs. Look up a stock's Composite Rating atIBD Stock Checkup.

By The Numbers: One Of The Best Mutual Funds

Goldman Sachs Large Cap Growth Insights Fund became an IBD Best Mutual Fund Awards winner by topping the S&P 500 in 2020 and in the three, five and 10 years ended last Dec. 31.

This year going into Wednesday, the fund is on track to repeat as an Awards winner with a 26.35% return. That tops the S&P 500's 25.51%. The fund's large-cap growth rivals tracked by Morningstar Direct were up 18.17% on average.

If you need non-institutional access, you can buy A-class shares (GLCGX) of the fund for a minimum initial investment of $1,000.

Follow Paul Katzeff onTwitter at @IBD_PKatzeff for tips about retirement planning and actively run portfolios that consistently outperform and rank among the best mutual funds.

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