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When markets are heading south and the economy is facing rough weather; precious metals can prove to be a safe haven of refuge. In fact, this is the period when they can outperform stocks, posting consistently higher returns. Gold and other precious metals are natural hedges against a currency losing value. Therefore, a small amount of precious metals in a portfolio can provide sufficient diversification as well as protection against inflation. Since they possess the advantages of professional management and a wide portfolio, precious metals funds are the brightest choice for investing in this sector.
Below we will share with you 5 top rated precious metals funds. Each has earned a Zacks #1 Rank (Strong Buy) as we expect the fund to outperform its peers in the future. To view the Zacks Rank and past performance of all precious metals funds, then click here.
USAA Precious Metals and Minerals (USAGX) seeks protection against inflation and long term capital growth. It invests the majority of its assets in domestic and foreign companies with primary operations in the precious metals sector. It is non-diversified and has a three year annualized return of 11.77%.
The precious metals fund has a minimum initial investment of $3,000 and an expense ratio of 1.31% compared to a category average of 1.49%.
RiverSource Precious Metal & Mining A invests at least 80% of its assets in precious metals companies or those in the mining sector. At least 65% of its assets are invested in precious metals related industries. Up to 10% of its total assets may be invested in gold, diamonds, silver and other metals occurring naturally within such metals. The precious metals fund has a five year annualized return of 15.82%.
The Fund Manager is Clay L. Hoes and he has managed this precious metals fund since 1999
Tocqueville Gold (TGLDX - MF report) seeks capital appreciation by investing in gold or companies involved in mining or processing of gold worldwide. Up to 20% of its total assets may be invested directly in precious metals. It is a no load fund
The precious metals fund returned 63.08% in 2009 and has a ten year annualized return of 21.84%.
OCM Gold (OCMGX - MF report) invests in domestic and foreign companies in the gold mining industry. It focuses on common stocks and may also invest in companies engaged in the production of precious metals. The precious metals fund has a ten year annualized return of 18.76%.
As of January 2010, this precious metals fund held 47 issues, with 12.88% of its total assets invested in Goldcorp, Inc.
Vanguard Precious Metals & Mining (VGPMX - MF report) seeks long-term capital growth. It invests the majority of its assets in domestic and foreign companies involved in the mining, processing and distribution of precious metals. Up to 20% of its assets may be directly invested in gold and other precious metals. This precious metals fund returned 77.75% in 2009.
Graham French is the fund manager and has managed this precious metals fund since 1996.
To view the Zacks Rank and past performance of all precious metals funds, then click here.
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/mutualfund/