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.
Rydex Series Trust Energy Services (RYVIX) seeks capital growth. It invests the majority of its assets in equity securities traded in U.S. markets and derivatives from the energy services sector. The fund focuses on investing in small and mid-cap companies from the sector. This energy mutual fund has returned 12.82% over the last one year period. < P> The fund manager is Michael P. Byrum and he has managed this energy mutual fund since 1998.
Guinness Atkinson Alternative Energy (GAAEX) seeks capital growth over the long term. The fund invests heavily in domestic and foreign companies from the alternative energy sector. The fund invests in companies regardless of their market capitalization and may also invest in developing economies. The energy mutual fund returned 57.09% in the last one year period.
The non-diversified mutual fund has an expense ratio of 1.98% as compared to category average of 1.65%.
ING Global Natural Resources A (LEXMX) invests heavily in equity securities of domestic or foreign companies related to the natural resources industry. A maximum of 50% of its assets may be invested in any single industry related to natural resources. The non-diversified fund returned 12.27% over the last one-year period.
As of December 2013, the fund held 71 issues with 9.34% of its assets invested in Exxon Mobil Corporation.
Franklin Natural Resources A (FRNRX) seeks high return. The fund invests most of its assets in equity and debt securities of those companies whose primary operations relate to natural resources. The company may invest a small portion in equity and debt securities issued by foreign companies with market cap not more than $1.5 billion. The fund has returned 9.80% over the last one year period.
The fund has an initial expense ratio of 1.08% as compared to category average of 1.52%.
Vanguard Energy (VGENX) seeks capital growth on a long-term basis. Majority of the investment are 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 fund has returned 13.83% over the last one year period.
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.
Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report >>
Read the analyst report on RYVIX
Read the analyst report on GAAEX
Read the analyst report on LEXMX
Read the analyst report on FRNRX
Read the analyst report on VGENX
View All Zacks #1 Ranked Mutual Funds
Zacks Investment Research