The healthcare sector is one of the most desirable avenues for parking investments when markets are headed south. The demand for such services usually remains unchanged even during an economic downturn and investments in the sector provide sufficient protection to the capital invested. Several pharmaceutical companies also provide regular dividends, which can help mitigate losses from falling share prices. Healthcare mutual funds provide the perfect avenue for investors looking to invest in this sector.
Below we will share with you 5 top rated health mutual funds. Each has earned a Zacks #1 Rank (Strong Buy) as we expect these mutual funds to outperform their peers in the future. To view the Zacks Rank and past performance of all health funds, investors can click here to see the complete list of funds.
Schwab Health Care (SWHFX) invests the majority of its assets in the healthcare sector. It mainly invests in equity securities but may also invest in derivatives. The fund focuses on investing in domestic firms, but may invest up to 25% of its assets in other countries. The healthcare mutual fund has a three year annualized return of 17.71%.
Paul Alan Davis is the fund manager and has managed this healthcare mutual fund since 2006.
Vanguard Health Care Index (VHCIX) seeks to match the performance of the MSCI U.S. Investable Market Health Care 25/50 index and invests primarily in healthcare stocks. This index consists of stocks of companies of all sizes from this sector. The healthcare mutual fund has a three year annualized return of 15.44%.
As of December 2012, this healthcare mutual fund held 295 issues, with 10.55% of its total assets invested in Johnson & Johnson.
Kinetics Medical No Load (MEDRX) invests a large share of its assets in companies whose principal operations are related to medical research, pharmaceutical and medical technology as well as related sectors. It focusing on companies engaged in cancer research and drug discovery. The healthcare mutual fund is non-diversified and has a three year annualized return of 11.36%.
The healthcare mutual fund has a minimum initial investment of $2,500 and an expense ratio of 1.39% compared to a category average of 1.52%.
Fidelity Select Medical Delivery (FSHCX) seeks capital growth. The fund invests in firms engaged in the delivery of health care services. Such companies include those which manage hospitals, nursing homes health maintenance organizations and other firms focusing on delivery of healthcare services. The healthcare mutual fund has a three year annualized return of 11.91%.
Steven Bullock is the fund manager and has managed this healthcare mutual fund since 2012.
Biotechnology UltraSector ProFund Service (BIPSX) invests in equity securities and derivatives which together should provide daily returns which are 150% of the daily return of the Dow Jones U.S. Biotechnology Index. The healthcare mutual fund is non-diversified and has a three year annualized return of 31.63%.
The healthcare mutual fund has a minimum initial investment of $15,000 and an expense ratio of 2.73% compared to a category average of 1.52%.
To view the Zacks Rank and past performance of all health mutual funds, investors can click here to see the complete list of funds.
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
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