The healthcare sector is one of the most desirable avenues for parking investments when markets are headed south. The demand for such services usually remains unchanged even during an economic downturn and investments in the sector provide sufficient protection to the capital invested. Several pharmaceutical companies also provide regular dividends, which can help mitigate losses from falling share prices. Healthcare mutual funds provide the perfect avenue for investors looking to invest in this sector.
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.
ProFunds Biotechnology UltraSector (BIPSX - Free Report) seeks daily returns which are 150% of the daily return of the Dow Jones U.S. Biotechnology Index. To achieve the desired results, this fund invests in a mix of securities as well as derivatives. The non-diversified mutual fund returned 62.84% over the last three years.
The fund has an expense ratio of 2.68% as compared to category average of 2.09%.
Fidelity Select Biotechnology (FBIOX - Free Report) invests the majority of its assets in companies involved in the research, manufacture and distribution of biotechnological products, services, and processes. The fund also invests in companies that gain from technological developments in the arena. The non-diversified mutual fund returned 47.14% over the last three years.
Rajiv Kaul is the fund manager and has managed this healthcare mutual fund since 2005.
Franklin Biotechnology Discovery A (FBDIX - Free Report) seeks capital growth. The fund invests the majority of its assets in companies involved in biotechnology and discovery research activities. Additionally, the company may invest a maximum of 20% of its assets in securities issued by foreign or domestic companies. The non-diversified mutual fund returned 41.42% over the last three years.
As of December 2013, this fund held 96 issues with 9.94% of its assets invested in Gilead Sciences Inc.
Prudential Jennison Health Sciences A (PHLAX - Free Report) seeks growth over the long term. This non-diversified fund utilizes the bulk of its assets to purchase equity securities of companies in the health sciences sector. The fund may invest over 5% of assets in a single issuer. The mutual fund returned 36.42% over the last three years.
The fund has an expense ratio of 1.18% as compared to category average of 1.44%.
ProFunds UltraSector Health Care (HCPSX - Free Report) seeks daily returns which are 150% of the daily return of the Dow Jones U.S. Biotechnology Index. The fund invests in equity securities and derivatives that in the opinion of the fund advisors possess daily return characteristics identical to one and a half times the daily return of the Dow Jones U.S. Health Care Index. The mutual fund returned 36.42% over the last three years.
Michael Neches is the fund manager and has managed this fund since 2013.
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.