Do investors require to shift funds to newer mutual funds which have more potential for growth?

A great mutual fund tends to outperform its underlying asset class over the long term. A good one reflects consistent growth over its lifetime. A bad one tends to underperform or lag its underlying asset class. To answer your question, mutual funds do not saturate in growth. If they do so consistently, there is a problem with the fund strategies, which should lead to shifting your loyalties.

There are funds that have grown consistently with an upward strategy over 20-30 years. If is any stunted growth, that can be attributed to the functioning of the individual scheme rather than a generalized stance on mutual funds.