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.
BlackRock Energy & Resources Investor A (SSGRX) seeks capital appreciation over the long run. It invests a lion’s share of its assets in small cap companies related to sectors including energy, natural resources and utilities. The fund has no limit on number of companies it can invest in, but it will invest in a minimum of three countries. This energy mutual fund has a one year return of 31.43%. This non-diversified fund has an expense ratio of 1.34% as compared to category average of 1.55%.
Fidelity Select Natural Resources Portfolio (FNARX) invests a large share of its assets in companies whose principal operations are related to the natural resources industry. The fund considers a company’s financial status and industry rank, and also looks into market and economic condition for investment decisions. This energy mutual fund has a one year return of 26.71%.
John Dowd is the fund manager and has managed this fund since 2006.
Frost Natural Resources A (FNATX) seeks capital appreciation on a long-term basis. It invests majority of its assets in natural resources companies. It invests in both U.S. and non U.S. companies. It may also invest in financial instruments including American Depositary Receipts. This energy mutual fund has a one year return of 21.41%.
As of February 2014, this fund held 42 issues with 5.87% of its assets invested in Schlumberger NV.
Fidelity Select Energy Portfolio (FSENX) invests largely in companies related to energy sector. Investments are made in conventional resources such as oil, gas and electricity, among others, and also newer resources like nuclear, geothermal, oil shale, and solar power. It generally invests in common stocks. This energy mutual fund has a one year return of 27.05%.
This non-diversified fund has an expense ratio of 0.81% as compared to category average of 1.55%.
Vanguard Energy (VGENX) seeks capital growth over long run. It invests major portion of its assets in companies whose primary operations are related to the energy sector including exploration, production, and transmission of energy or energy fuels, and in other services like research and energy conservation. This energy mutual fund has a one year return of 24.56%.
Karl E. Bandtel is the fund manager and has managed this fund since 2002.
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
Read the analyst report on SSGRX
Read the analyst report on FNARX
Read the analyst report on FNATX
Read the analyst report on FSENX
Read the analyst report on VGENX
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