Technology mutual funds are ideal for investors seeking long-term growth and impressive returns. Improving industry fundamentals and emerging technologies such as AI, ML, robotics and data science are the key catalysts to the sector’s growth.

In addition, the majority of funds investing in securities from the technology sector take a growth-oriented approach that includes focusing on companies with strong fundamentals and a relatively better investment prospect.

Moreover, technology has come to have a broader meaning than just hardware and software. Social media and Internet companies are now part of the technology landscape. The Technology Select Sector SPDR Fund (XLK) has gained 45.5% over the past year.

Under such circumstances, investing in technology mutual funds seems prudent. However, choosing the right mutual funds for your portfolio can be cumbersome. To that end, let us find out which of the two funds discussed below is better.

T. Rowe Price Global Technology Fund (PRGTX Quick QuotePRGTX - Free Report)

This fund aims for long-term capital growth. This non-diversified fund invests most assets in the common stocks of companies that its managers expect will generate majority of their 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 34.8% and 28.1% 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.

T. Rowe Price Global Technology Fund, as of the last filing, allocates its assets in the top two major groups; Large Growth and Foreign Bond. Further, as of the last filing, Sea Limited and Zoom Video Communications, Inc. were the top holdings for PRGTX.

Sporting a Zacks Mutual Fund Rank #1 (Strong Buy), PRGTX was incepted in September 2000 and is managed by T. Rowe Price. The fund carries an expense ratio of 0.86% and requires a minimal initial investment of $2,500.

Fidelity Select Software & IT Services Portfolio (FSCSX Quick QuoteFSCSX - Free Report)

This fund aims for capital appreciation. The non-diversified fund invests the majority of its 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 returned 25.2% and 26.7% in the past three and five years, respectively. To see how this fund performed compared in its category, and other 1 and 2 Ranked Mutual Funds, please click here.

Fidelity Select Software & IT Services Portfolio fund, as of the last filing, allocates its assets in the top two major groups; Large Growth and Intermediate Bond. Further, as of the last filing Microsoft Corporation and Visa Inc. were the top holdings for FSCSX.

This Zacks Rank #1 fund was incepted in July 1985 and carries an expense ratio of 0.70%. It requires a minimal initial investment of $0 and is managed by Fidelity.

To Conclude

While both PRGTX and FSCSX carry a Zacks Mutual Fund Rank #1, upon having a closer look, we find that the latter is a clear winner. Not only are FSCSX’s administrative and other operating expenses lower than PRGTX’s, the former has a history of providing stable returns. Notably, FSCSX has a 3-year beta of 1.01 compared to PRGTX’s 1.09. So, it is only fair to conclude that FSCSX is worth buying as it offers stable returns at lower risk.

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