Dumping American Century Ultra Mutual Fund – TWCUX

January 18, 2007

I started investing in American Century Ultra in 2003, a year in which it returned around 25% according to Morningstar. I’ve been dollar cost averaging into the fund ever since and am embarrassed to say that I’ve been meaning to get out of it for a while now but have procrastinated for far too long.

Searching for Growth
The receipt of the dismal year-end statement in the mail today finally spurred me to action. Due to retirement plan options I have to find a replacement within the American Century family of funds. The Ultra fund is filling a growth spot in our portfolio allocation so I searched for other growth funds on the American Century website.

A Promising Option
I ran across a promising option in the Heritage Fund (TWHIX). It is categorized by Morningstar to have a style of Medium Growth as opposed to the Large Growth style of Ultra. However, since a large chunk of our portfolio is invested in large growth via VFINX, downsizing to invest in smaller companies shouldn’t really skew our diversification there. Both funds carry a 1% expense ratio. A comparison of their average annual returns shows that Heritage Fund comes out on top.

Moving Ahead
My plan is to move all of the money currently invested in the Ultra fund into the Heritage fund. I suppose I could move the money over in increments during the next few months to try and balance out any big moves in the fund’s value. However, it is likely I will move it all at once in the near future. If anyone has any suggestions on implementing the move I’d love to hear them.


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3 Responses to Dumping American Century Ultra Mutual Fund – TWCUX

  • moneysmartz

    chris, I don’t know what the future holds for Ultra. All I know is that it’s future doesn’t include me. As I mention, I’m moving my money from Ultra to the Heritage fund.

    The majority of our assets are invested in index funds but the mix of our retirement plans mean we have to invest some of our money with American Century. Since they don’t have a growth index fund I’m going with Heritage.

  • chris

    Hi, I have been investing into ultra but I have lost money while index fund had over 10% return. I have been thinking about dumping this fund but I am not sure it is a right choice or not. I paid mid 30s for this fund and average retun over 10 years is less than what I paid. Does this fund has a potential to outperform in the future???


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