Top 5 European Funds

The European Commission’s announcement that confidence in the region’s economy has risen to the highest level in two years signifies a clear improvement in Europe’s economic outlook. Additionally, positive results from the EU bank’s stress tests and prospects of a weak US recovery have pushed the euro to its highest level since the region’s $1 trillion bailout. Mutual funds focusing on Europe are back in favor again as the region offers healthy prospects for investors. Of particular interest are its emerging markets, many of whom have continued to perform despite the specter of a global slowdown.

Below we will share with you 5 top rated European funds. Each has earned a Zacks #1 Rank (Strong Buy) as we expect the fund to outperform its peers in the future. To view the Zacks Rank and past performance of all European funds, then click here.

Henderson European Focus A (HFEAX) invests the majority of its assets in equity securities of European companies. Companies invested in must be located in Europe or their principal office or major trading market must be located in the region. The European fund returned 18.37% in the last one year period.

The European fund has a minimum initial investment of $500 and an expense ratio of 1.72% compared to a category average of 1.72%.

Metzler/Payden European Emerging Markets (MPYMX) seeks long-term capital growth. The fund invests heavily in companies located in European emerging market countries. It focuses on acquiring equity securities that are tradable and pay dividends in foreign currencies such as the euro. The European fund has a five year annualized return of 9.01%.

Markus Brueck is the fund manager and has managed this European fund since 2002.

T. Rowe Price Emerging Europe & Mediterranean (TREMX) invests at least 80% of assets in emerging-market securities. The fund invests in companies without regard to their size or market capitalization. It focuses on purchasing common stocks of companies located in or having primary operations in emerging market countries. The European fund returned 40.16% in the last one year period.

The European fund has a minimum initial investment of $2,500 and an expense ratio of 1.64% compared to a category average of 1.78%.

U.S. Global Investors Eastern European (EUROX) seeks capital appreciation over the long term. The majority of its assets are used to purchase equity and equity related securities of companies from Eastern Europe. At least 25% of its assets are invested in securities of oil, gas or banking companies. The European fund has a three year annualized return of 20.79%

As of March 2010, this European fund held 59 issues, with 10.31% of its total assets invested in Ak Sberegatelny Bank Sberbank.

Invesco European Growth A (AEDAX) invests primarily in European companies. The fund focuses on acquiring marketable securities, but may also purchase synthetic instruments. Up to 35% of its assets may be invested in European companies from emerging markets. The European fund returned 12.21% in the last one year period.

Clas T. Olsson is the fund manager and has managed this European fund since 1997.

To view the Zacks Rank and past performance of all European funds, then click here.

About Zacks Mutual Fund Rank

By applying the Zacks Rank to mutual funds, investors can find funds that not only outpaced the market in the past but are also expected to outperform going forward. Learn more about the Zacks Mutual Fund Rank at http://www.zacks.com/funds.

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