Of late the healthcare sector has witnessed heavy competition on account of short product pipelines and patent wars. However, the sector has often been regarded as “safe” by many investors. Traditionally, many investors seek solace in defensive sectors such as healthcare during a downturn. The sector is characterized by steady demand for their products, high revenue and abundant cash flows making it a secure sector. Healthcare mutual funds provide an excellent opportunity for investors seeking exposure to this space.
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.
Fidelity Select Health Care (FSPHX) seeks capital growth. The fund invests the majority of its assets in companies whose principal operations include production, design and sales of health care related products or services. It focuses on acquiring common stocks and purchases both domestic and foreign securities. The healthcare mutual fund returned 4.96% over the last one year period.
The healthcare mutual fund has a minimum initial investment of $2,500 and an expense ratio of 0.80% compared to a category average of 1.55%.
Invesco Global Health Care A (GGHCX) invests primarily in companies from the health care sector. The fund purchases securities from issuers located in at least three countries, including the US. Up to 50% of its assets may be invested in any one country, apart from the US. The healthcare mutual fund has a three year annualized return of 3.3%.
Derek Taner is the fund manager and has managed this healthcare mutual fund since 2005.
Kinetics Medical No Load (MEDRX) seeks capital appreciation over the long term. A large share of the fund’s assets is invested in companies whose principal operations are related to medical research, related technology industries. It focusing on companies engaged in cancer research and drug discovery. The healthcare mutual fund returned -4.24% in the last one year period.
As of March 2012, this healthcare mutual fund held 52 issues, with 6.58% of its total assets invested in Life Technologies Corp.
Saratoga Health & Biotechnology A (SHPAX) invests heavily in stocks of domestic and foreign healthcare and biotech firms of all sizes. Common and preferred stocks and related convertible securities constitute the fund’s major investments. The healthcare mutual fund returned 2.95% in the last one year period.
The healthcare mutual fund has a minimum initial investment of $250 and an expense ratio of 2.73% compared to a category average of 1.55%.
Live Oak Health Sciences (LOGSX) seeks capital growth over the long term. The fund invests heavily in companies from the health sciences sector. It focuses on acquiring equity securities, focusing on purchasing domestic common stock. It may also invest in foreign common stocks and ADRs. The healthcare mutual fund returned -0.9% in the last one year period.
Mark W. Oelschlager is the fund manager and has managed this healthcare mutual fund since 2001.
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.
More From Zacks.com