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.
Franklin Natural Resources A (FRNRX) seeks high total return. The fund invests a large share of its assets in equity and debt securities of natural resources companies. A maximum of 20% of its assets may be invested in both domestic and foreign securities from other sectors. The energy mutual fund has a three year annualized return of 5.38%.
The fund manager is Frederick Fromm and he has managed this energy mutual fund since 2003.
Putnam Global Natural Resources A (EBERX) invests the majority of its assets in common stocks. The fund purchases both value and growth oriented stocks. It concentrates on investing in large and mid-cap companies. The energy mutual fund has a three year annualized return of 5.37%.
The energy mutual fund has no minimum initial investment and an expense ratio of 1.29% compared to a category average of 1.47%.
Ivy Energy A (IEYAX) seeks capital appreciation. It invests a large share of its assets in equity securities of energy and natural resources companies. The fund invests in companies that have strong linkages with the energy sector. The energy mutual fund has a three year annualized return of 4.89%.
As of September 2012, this energy mutual fund held 53 issues, with 5.70% of its total assets invested in National Oilwell Varco, Inc.
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. The energy mutual fund is non-diversified and has a three year annualized return of 4.58%. The fund manager is John Bailey and he has managed this energy mutual fund since 2011.
BlackRock All-Cap Energy & Resources Investor A (BACAX) seeks capital appreciation over the long term. The fund invests the majority of its assets in energy and natural resources firms worldwide. The energy mutual fund is non-diversified and has a three year annualized return of 2.80%. The energy mutual fund has a minimum initial investment of $1,000 and an expense ratio of 1.34% compared to a category average of 1.66%.
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.