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. For fast growing economies such as China and India, the situation is even more acute. Thus, prices of these invaluable resources are surging. Investors can benefit from the situation by investing in the energy industry. Energy mutual funds are a superior option for forays into this space 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 A (BACAX) invests the majority of its assets in domestic and foreign natural resources and energy companies. It may also invest in related businesses and utilities. However, a minimum of 25% of its assets must be invested in the energy sector. The energy mutual fund has a three year annualized return of 3.17%.
The fund manager is Poppy Allonby, who has managed this energy mutual fund since 2013.
Ivy Global Natural Resources A (IGNAX) seeks capital appreciation. It invests heavily in equity securities of companies, whose primary operations are related to natural resources, including suppliers and service providers. It may invest in both foreign and domestic firms whose primary operations are conducted abroad. This energy mutual fund has a three year annualized return of 2.71%.
The energy mutual fund has an expense ratio of 1.52% compared to a category average of 1.47%.
JHancock2 Natural Resources 1 (JINRX) invests heavily in equity and related securities of those global companies that are related to the natural resources industry, including those from emerging markets. Investments are focused on those companies that can profit from the future demand growth of natural resources. This energy mutual fund has a three year annualized return of 0.53%.
As of June 2013, this energy mutual fund held 86 issues, with 3.07% of its total assets invested in Rio Tinto PLC.
Vanguard Energy (VGENX) seeks capital growth on a long-term basis. The majority of the investment is parked in companies whose primary operations are involved in energy and energy fuels. The fund may also invest all its assets in foreign companies. The energy mutual fund has a three year annualized return of 9.34%.
The fund manager is Karl E. Bandtel and he has managed this energy mutual fund since 2002.
Waddell & Reed Energy A (WEGAX) invests a large portion of its assets in companies whose primary operations are related to the energy industry. The fund may invest all of its assets in foreign securities. The energy mutual fund has a three year annualized return of 12.20%. The energy mutual fund has an expense ratio of 1.68%, compared to a category average of 1.50%.
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 at http://www.zacks.com/funds.
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