Energy mutual funds offer an attractive opportunity to investors with a long term horizon since they represent a stable industry with a bright future. The demand for energy continues to rise steadily and this is particularly true of nations growing at a rapid pace such as China and India. Along with this trend, the pressure on natural resources which are harnessed to provide energy and related services has also increased considerably. With the advantages of professional management and well diversified portfolios mutual funds are the most viable route to invest in this sector.
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.
Ivy Energy A (IEYAX) seeks capital appreciation over the long term. The fund invests the majority of its assets in securities issued by energy companies. Companies engaged in exploration, discovery, production and distribution of energy constitute the fund’s major investments. The energy mutual fund has a three year annualized return of 4.5%.
The fund manager is David P. Ginther and he has managed this energy mutual fund since 2006.
Vanguard Energy Index (VENAX) invests in approximately all of the equity securities which make up its target index, the MSCI US Investable Market Energy 25/50 Index. This index is made of large, medium and small domestic companies from the energy sector. The energy mutual fund has a three year annualized return of 9.06%.
As of March 2012, this energy mutual fund held 167 issues, with 23.61% of its total assets invested in Exxon Mobil Corporation.
JHancock2 Natural Resources 1 (JINRX) seeks total return over the long term. The fund invests a large share of its assets in equity and related securities of companies across the world whose primary operations involve natural resources. The energy mutual fund has a three year annualized return of -0.96%.
The energy mutual fund has an expense ratio of 1.12% compared to a category average of 1.42%.
Calvert Global Alternative Energy A (CGAEX) invests the majority of its assets in domestic and foreign companies from the alternative energy sector. The fund focuses on acquiring common stocks of small and mid-cap companies. The energy mutual fund has a three year annualized return of -20.36%.
The fund manager is Treasa Chonghaile and she has managed this energy mutual fund since 2007.
Fidelity Select Energy Services (FSESX) seeks capital growth. The fund invests a large proportion of its assets in companies from the energy services domain. These companies could provide services to both conventional and alternative energy firms. The energy mutual fund has a three year annualized return of 5.4%.
The energy mutual fund has a minimum initial investment of $2,000 and an expense ratio of 0.81% compared to a category average of 1.58%.
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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