As the global appetite for energy continues to increase rapidly, governments and corporations alike are devoting greater resources for the discovery of new energy sources as well as the development of more efficient technology in this domain. In fact, newer economic powerhouses such as China are discovering that the going is even tougher for them. Prices of these invaluable resources continue to rise at a steady rate and the energy sector is clearly a lucrative investment option. Mutual funds are a superior option for forays into the industry as they reduce risks involved by holding widely diversified portfolios.
Below we will share with you 5 top rated energy 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 energy funds, investors can click here to see the complete list of funds.
Franklin Natural Resources A (FRNRX) seeks high total return. The fund invests a large share of its assets in equity and debt securities of natural resources companies. A maximum of 20% of its assets may be invested in both domestic and foreign securities from other sectors. The energy mutual fund has a three year annualized return of 4.34%.
The fund manager is Frederick Fromm and he has managed this energy mutual fund since 2003.
ING Global Natural Resources A (LEXMX) invests heavily in equity securities of domestic or foreign companies related to the natural resources industry. A maximum of 50% of its assets may be invested in any single industry. This energy mutual fund has a three year annualized return of 3.87%.
The energy mutual fund has a minimum initial investment of $1,000 and an expense ratio of 1.56% compared to a category average of 1.56%.
BlackRock All-Cap Energy & Resources Investor A (BACAX) seeks capital appreciation over the long term. The fund invests the majority of its assets in energy and natural resources firms worldwide. The energy mutual fund has a three year annualized return of 0.58%.
As February 2013, this energy mutual fund held 61 issues, with 5.12% of its total assets invested in EOG Resources.
JHancock2 Natural Resources 1 (JINRX) invests a large share of its assets in equity and related securities of companies across the world whose primary operations involve natural resources. It focuses on those companies which may generate higher profits from the rising demand of natural resources. The energy mutual fund has a three year annualized return of -0.35%. < P> The energy mutual fund has an expense ratio of 1.11% compared to a category average of 1.56%.
RS Global Natural Resources A (RSNRX) seeks capital growth over the long term. The fund invests heavily in shares of companies primarily engaged in the energy and natural resources business. It invests in minimum three different nations. This energy mutual fund has a three year annualized return of 8.63%.
The fund manager is Andrew J. Pilara, Jr. and he has managed this energy mutual fund since 1995.
To view the Zacks Rank and past performance of all energy 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.
More From Zacks.com