Top 5 Zacks #1 Ranked Healthcare Mutual Funds

Zacks

When markets are passing through choppy waters, investors often rely on the healthcare sector to safeguard their investments. This is because the demand for healthcare services does not vary with market conditions, making them a safe haven during difficult times. Many pharma companies also generate regular dividends, which go a long way in softening the blow dealt by plummeting share prices. Mutual funds are the perfect choice for investors looking to enter this sector since they possess the advantages of wide diversification and analytical insight.

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.

Eaton Vance Worldwide Health Sciences A (ETHSX) focuses on investing in medical research and the healthcare sector. The fund invests the majority of its assets in companies which are primarily involved in activities involving new scientific developments in healthcare. The healthcare mutual fund has a three year annualized return of 11.16%.

The healthcare mutual fund has a minimum initial investment of $1,000 and an expense ratio of 1.96% compared to a category average of 1.49%.

Prudential Jennison Health Sciences A (PHLAX) seeks capital growth over the long term. The fund invests a large share of its assets in firms from the health sciences domain. Equity and related securities of pharma companies, biotech firms, service providers and medical device manufacturers constitute its major investments. The healthcare mutual fund has a three year annualized return of 21.98%.

David A. Chan is the fund manager and has managed this healthcare mutual fund since 1999.

Schwab Health Care (SWHFX) invests heavily in the healthcare sector. The fund primarily purchases equity securities but may also invest in future contracts. It 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 15.22%.

The healthcare mutual fund has a minimum initial investment of $100 and an expense ratio of 0.81% compared to a category average of 1.49%.

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 14.08%.

As of June 2012, this healthcare mutual fund held 300 issues, with 10.43% of its total assets invested in Johnson & Johnson.

Putnam Global Health Care A (PHSTX) invests primarily in companies from the health care sector. Common stocks of large and mid cap firms across the world constitute the majority of his investments. The fund may purchase both growth and value stocks. The healthcare mutual fund has a three year annualized return of 8.02%.

Kelsey Chen is the fund manager and has managed this healthcare mutual fund since 2005.

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 at http://www.zacks.com/funds.

Read the analyst report on ETHSX

Read the analyst report on PHLAX

Read the analyst report on SWHFX

Read the analyst report on VHCIX

Read the analyst report on PHSTX



View All Zacks #1 Ranked Mutual Funds

Zacks Investment Research



More From Zacks.com

Rates

View Comments (0)