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Top Tech Trends to Boost These 4 Mutual Funds in 2021
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The coronavirus pandemic affected almost every sector in 2020. However, the technology sector emerged as bright spot in the all the gloom. While trends like faster drug development, effective remote care and efficient supply chain are poised to continue into 2021, certain trends will sure push tech funds to greater highs.
Top Tech Trends to Dominate 2021
In 2020, segments like drone technology started playing a vital role in delivering food and other essentials during the lockdown period. We have seen security bots keeping roads safe, cleaning bots keeping public places sanitized and much more. Even with vaccines rolled out, some of these tech trends may remain. Here are a few old and new tech trends that will keep the sector going in 2021-
AI to Reshape Business: Across the world, businesses made radical changes to adapt to the lockdown phase and to abide by social-distancing norms. Several companies took a giant leap to adapt to the new normal, implementing cloud computing, artificial intelligence (AI) and cybersecurity to allow employees to work remotely. AI and cloud computing has boosted efficiency and security along with optimization and confidence among employees working from home. This rapid adoption of tech in businesses has paved the way for quantum computing in 2021. Businesses will opt for the hybrid computing approach to solve problems and this shift in computing will reduce existing business problems and open up new opportunities.
Autonomous Cars: Though full self-driving cars are still in very early beta, for now, it allows drivers to automatically handle city streets, traffic lights, roundabouts and street turns. The year 2021 will see development in autonomous cars. Big tech companies like Google have entered the race with veterans like Tesla, General Motors and Ford. Waymo is faring well in the autonomous cars race in America it plans to extend the service in Phoenix and beyond this year.
Electric and Robotic Innovation: While the pandemic had led several manufactures to replace staff with robotic arms, the household space saw the adoption of several cleaning bots. The robotics space is poised to boom on lower work load and easing of daily routines. Additionally, the idea to develop machines that have a much smaller impact on the environment will boost the aerospace industry. Technological advances and rapid research and development have brought us hydrogen-powered jets with low emission. Rolls-Royce is one among them planning to release an electric aircraft that can break the world speed record for an electric aircraft by flying at more than 300mph in 2021.
Automation in Retail Space: Brick-and-mortar stores have faced the brunt of the pandemic in 2020. However, the ones that survived is sure to see technological modification in 2021. To stand up strong against the online shopping spree, retailers are planning to use a combination of cameras and AI to run stores instead of staff.
Remote Working Technology: Per a CCS Insights survey, business leaders in the United States expect at least 25% of their workforce to work from home (at least partly) even when the pandemic is over. Hence, several work-from-home packages can be offered by Internet service providers and other tech firms to help people collaborate while working from home.
4 Top Fund Picks
Given the promising tech trends in 2021, we have shortlisted four mutual funds carrying a Zacks Mutual Fund Rank #1 (Strong Buy) that are poised to grow. Moreover, these funds have encouraging year-to-date (YTD) returns. Additionally, the minimum initial investment is within $5000. We expect these funds to outperform peers in the future.
The question here is why should investors consider mutual funds? Reduced transaction costs and diversification of portfolio without several commission charges that are associated with stock purchases are primarily why one should be parking money in mutual funds (read more: Mutual Funds: Advantages, Disadvantages, and How They Make Investors Money).
Janus Henderson Global Technology and Innovation Fund Class T (JAGTX - Free Report) aims for long-term growth of capital. The fund invests majority of assets in securities of companies that the fund managers believe will significantly benefit from advances in technology.
This Zacks Sector – Tech product has a history of positive total returns for more than 10 years. Specifically, JAGTX has returned 28.3% and 27.2% in the past three and five years, respectively. To see how this fund performed compared to its category, and other 1 and 2 Ranked Mutual Funds, please click here.
JAGTX has an annual expense ratio of 0.93%, which is below the category average of 1.24%.
Fidelity Select Software & IT Services Portfolio (FSCSX - Free Report) aims for capital appreciation. The non-diversified fund invests majority of assets in common stocks of companies engaged in research, design, production or distribution of products or processes that relate to software or information-based services.
This Zacks Sector – Tech product has a history of positive total returns for more than 10 years. Specifically, FSCSX has three and five-year returns of 26.1% and 24.6%, respectively. To see how this fund performed compared to its category, and other 1 and 2 Ranked Mutual Funds, please click here.
FSCSX has an annual expense ratio of 0.71% versus the category average of 1.24%.
T. Rowe Price Global Technology Fund (PRGTX - Free Report) aims for long-term capital growth. The fund invests most assets in the common stocks of companies that its managers expect will generate majority of revenues from the development, advancement and use of technology.
This Zacks Sector – Tech product has a history of positive total returns for more than 10 years. Specifically, PRGTX has returned nearly 26% and 25.7% in the past three and five years, respectively. To see how this fund performed compared to its category, and other 1 and 2 Ranked Mutual Funds, please click here.
PRGTX is a non-diversified fund and has an annual expense ratio of 0.88%, which is below the category average of 1.24%.
Fidelity Select Technology Portfolio (FSPTX - Free Report) aims for capital appreciation. The fund invests primarily in equity securities, especially common stocks of companies that are engaged in offering, using, or developing products, processes, or services that will provide or will benefit significantly from technological advances and improvements.
This Zacks Sector – Tech product has a history of positive total returns for more than 10 years. Specifically, FSPTX has returned 27.8% and 28.3% in the past three and five years, respectively. To see how this fund performed compared to its category, and other 1 and 2 Ranked Mutual Funds, please click here.
FSPTX is a non-diversified fund and has an annual expense ratio of 0.71%, which is below the category average of 1.24%.
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Top Tech Trends to Boost These 4 Mutual Funds in 2021
The coronavirus pandemic affected almost every sector in 2020. However, the technology sector emerged as bright spot in the all the gloom. While trends like faster drug development, effective remote care and efficient supply chain are poised to continue into 2021, certain trends will sure push tech funds to greater highs.
Top Tech Trends to Dominate 2021
In 2020, segments like drone technology started playing a vital role in delivering food and other essentials during the lockdown period. We have seen security bots keeping roads safe, cleaning bots keeping public places sanitized and much more. Even with vaccines rolled out, some of these tech trends may remain. Here are a few old and new tech trends that will keep the sector going in 2021-
AI to Reshape Business: Across the world, businesses made radical changes to adapt to the lockdown phase and to abide by social-distancing norms. Several companies took a giant leap to adapt to the new normal, implementing cloud computing, artificial intelligence (AI) and cybersecurity to allow employees to work remotely. AI and cloud computing has boosted efficiency and security along with optimization and confidence among employees working from home. This rapid adoption of tech in businesses has paved the way for quantum computing in 2021. Businesses will opt for the hybrid computing approach to solve problems and this shift in computing will reduce existing business problems and open up new opportunities.
Autonomous Cars: Though full self-driving cars are still in very early beta, for now, it allows drivers to automatically handle city streets, traffic lights, roundabouts and street turns. The year 2021 will see development in autonomous cars. Big tech companies like Google have entered the race with veterans like Tesla, General Motors and Ford. Waymo is faring well in the autonomous cars race in America it plans to extend the service in Phoenix and beyond this year.
Electric and Robotic Innovation: While the pandemic had led several manufactures to replace staff with robotic arms, the household space saw the adoption of several cleaning bots. The robotics space is poised to boom on lower work load and easing of daily routines. Additionally, the idea to develop machines that have a much smaller impact on the environment will boost the aerospace industry. Technological advances and rapid research and development have brought us hydrogen-powered jets with low emission. Rolls-Royce is one among them planning to release an electric aircraft that can break the world speed record for an electric aircraft by flying at more than 300mph in 2021.
Automation in Retail Space: Brick-and-mortar stores have faced the brunt of the pandemic in 2020. However, the ones that survived is sure to see technological modification in 2021. To stand up strong against the online shopping spree, retailers are planning to use a combination of cameras and AI to run stores instead of staff.
Remote Working Technology: Per a CCS Insights survey, business leaders in the United States expect at least 25% of their workforce to work from home (at least partly) even when the pandemic is over. Hence, several work-from-home packages can be offered by Internet service providers and other tech firms to help people collaborate while working from home.
4 Top Fund Picks
Given the promising tech trends in 2021, we have shortlisted four mutual funds carrying a Zacks Mutual Fund Rank #1 (Strong Buy) that are poised to grow. Moreover, these funds have encouraging year-to-date (YTD) returns. Additionally, the minimum initial investment is within $5000. We expect these funds to outperform peers in the future.
The question here is why should investors consider mutual funds? Reduced transaction costs and diversification of portfolio without several commission charges that are associated with stock purchases are primarily why one should be parking money in mutual funds (read more: Mutual Funds: Advantages, Disadvantages, and How They Make Investors Money).
Janus Henderson Global Technology and Innovation Fund Class T (JAGTX - Free Report) aims for long-term growth of capital. The fund invests majority of assets in securities of companies that the fund managers believe will significantly benefit from advances in technology.
This Zacks Sector – Tech product has a history of positive total returns for more than 10 years. Specifically, JAGTX has returned 28.3% and 27.2% in the past three and five years, respectively. To see how this fund performed compared to its category, and other 1 and 2 Ranked Mutual Funds, please click here.
JAGTX has an annual expense ratio of 0.93%, which is below the category average of 1.24%.
Fidelity Select Software & IT Services Portfolio (FSCSX - Free Report) aims for capital appreciation. The non-diversified fund invests majority of assets in common stocks of companies engaged in research, design, production or distribution of products or processes that relate to software or information-based services.
This Zacks Sector – Tech product has a history of positive total returns for more than 10 years. Specifically, FSCSX has three and five-year returns of 26.1% and 24.6%, respectively. To see how this fund performed compared to its category, and other 1 and 2 Ranked Mutual Funds, please click here.
FSCSX has an annual expense ratio of 0.71% versus the category average of 1.24%.
T. Rowe Price Global Technology Fund (PRGTX - Free Report) aims for long-term capital growth. The fund invests most assets in the common stocks of companies that its managers expect will generate majority of revenues from the development, advancement and use of technology.
This Zacks Sector – Tech product has a history of positive total returns for more than 10 years. Specifically, PRGTX has returned nearly 26% and 25.7% in the past three and five years, respectively. To see how this fund performed compared to its category, and other 1 and 2 Ranked Mutual Funds, please click here.
PRGTX is a non-diversified fund and has an annual expense ratio of 0.88%, which is below the category average of 1.24%.
Fidelity Select Technology Portfolio (FSPTX - Free Report) aims for capital appreciation. The fund invests primarily in equity securities, especially common stocks of companies that are engaged in offering, using, or developing products, processes, or services that will provide or will benefit significantly from technological advances and improvements.
This Zacks Sector – Tech product has a history of positive total returns for more than 10 years. Specifically, FSPTX has returned 27.8% and 28.3% in the past three and five years, respectively. To see how this fund performed compared to its category, and other 1 and 2 Ranked Mutual Funds, please click here.
FSPTX is a non-diversified fund and has an annual expense ratio of 0.71%, which is below the category average of 1.24%.
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