With every passing year, the world’s appetite for energy continues to increase steadily. Governments and corporations alike are therefore constantly on the lookout for new energy sources or more efficient technology in this domain. For fast growing economies such as China and India, the situation is even more acute. Thus, prices of these invaluable resources are surging and investors could benefit from the situation by investing in the energy industry. Energy 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.
BlackRock All-Cap Energy & Resources Investor A (BACAX) seeks capital appreciation over long run. It invests a major portion of its assets in both foreign and domestic companies related to the energy and natural resources, and utilities sector. This non-diversified fund invests across the world and in a minimum of three countries. This energy mutual fund has a five year annualized return of 12.88%. The fund has an expense ratio of 1.37% as compared to category average of 1.64%.
Fidelity Advisor Energy A (FANAX) invests a lion’s share of its assets in companies associated with the energy sector. These companies may be related to both conventional or newer sources of energy like nuclear and solar power among others. It invests in companies irrespective of their location. Company’s financial condition, industry rank and overall market condition are considered for investment decisions. This non-diversified energy mutual fund has a five year annualized return of 16.82%.
John Dowd is the fund manager and has managed this fund since 2006.
ICON Energy A (ICEAX) seeks capital growth over long run. It invests majority of its assets in companies having their presence in energy sector. Investments are made in equities of energy companies irrespective of their market capitalizations. This non-diversified energy mutual fund has a five year annualized return of 3.96%.
As of February 2014, this fund held 41 issues with 14.50% of its assets invested in Exxon Mobil Corporation.
Invesco Energy A (IENAX) invests a large portion of its assets in companies related to the energy sector. The fund may also invest in other securities with economic features similar to energy companies. This energy mutual fund has a five year annualized return of 13.98%.
The fund has an expense ratio of 1.15% as compared to category average of 1.64%.
Rydex Energy A (RYENX) seeks capital growth. It invests a lion’s share of its assets in domestic energy companies. It may invest in companies ranging from small to medium market capitalization. It may also invest in ADRs and domestic government securities. This non-diversified energy mutual fund has a five year annualized return of 15.32%.
Michael P. Byrum is the fund manager and has managed this fund since 1998.
To view the Zacks Rank and past performance of all energy mutual funds, investors 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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Read the analyst report on BACAX
Read the analyst report on FANAX
Read the analyst report on ICEAX
Read the analyst report on IENAX
Read the analyst report on RYENX
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