During difficult market conditions, investors often depend on the healthcare sector to safeguard their investments. Since the demand for healthcare and related services does not vary with market conditions, they are a safe haven during tough times. Many pharmaceutical companies also generate regular dividends, which aid in combating losses from falling share prices. Mutual funds are the perfect choice for investors looking to enter this sector since they possess the analytical insight needed to keep abreast of the latest advancements in this domain.

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.

Putnam Global Health Care A ( PHSTX - MF report ) invests primarily in companies from the health care sector. Common stocks of large and midcap firms across the world constitute the majority of his investments. The fund may purchase both growth and value stocks. The healthcare mutual fund has a three year annualized return of 9.69%.

The healthcare mutual fund has a minimum initial investment of $500 and an expense ratio of 1.26% compared to a category average of 1.50%.

Fidelity Select Medical Equipment & Systems ( FSMEX - MF report ) seeks capital growth by investing the majority of its assets in the healthcare sector. The fund primarily invests in securities of companies which produce, distribute or develop medical equipment, devices and related technologies. The healthcare mutual fund has a three year annualized return of 12.91%.

Edward Lee Yoon is the fund manager and he has managed this healthcare mutual fund since 2007.

Prudential Jennison Health Sciences A ( PHLAX - MF report ) invests a large share of its assets in firms from the health sciences domain. Equity and related securities of pharma companies, biotech firms, service providers and medical device manufacturers constitute its major investments. The healthcare mutual fund has a three year annualized return of 23.22%.

The healthcare mutual fund has a minimum initial investment of $2,500 and an expense ratio of 1.25% compared to a category average of 1.50%.

Vanguard Health Care Index ( VHCIX - MF report ) seeks to match the performance of the MSCI U.S. Investable Market Health Care 25/50 index and invests primarily in healthcare stocks. This index consists of stocks of companies of all sizes from this sector. The healthcare mutual fund has a three year annualized return of 16.28%.

As of March 2012, this healthcare mutual fund held 298 issues, with 10.20% of its total assets invested in Johnson & Johnson.

ProFunds Pharmaceuticals UltraSector ( PHPSX - MF report ) invests in equity securities and derivatives which together should provide daily returns which are 150% of the daily return of the Dow Jones U.S. Pharmaceuticals Index. The balance of the fund’s assets is utilized to purchase money market securities. The healthcare mutual fund has a three year annualized return of 21.82%.

Hratch Najarian is the fund manager and he has managed this healthcare mutual fund since 2011.

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.