Utilities funds are an excellent choice for investors seeking a steady income flow. They are also used as defensive instruments, which protect investments during a market downturn. This is because the demand for essential services such as those provided by utilities remains unchanged even during difficult times. In recent years, many funds in this category have increased their exposure to emerging markets and unregulated companies. This has increased the risk involved but has also generated higher returns.
Below we will share with you 4 top utilities 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 utilities mutual funds, investors can click here to see the complete list of funds.
AllianzGI Global Water A (AWTAX - Free Report) seeks long term capital growth. AWTAX invests a major portion of its assets in common stocks of companies that are represented in the S&P Global Water Index, the NASDAQ OMX US Water or Global Water Indices or the S-Network Global Water Index, or are involved in water-related activities. The AllianzGI Global Water A is non-diversified fund and has a three year annualized return of 10%.
Andreas Fruschki is the fund manager and has managed AWTAX since 2008.
American Century Utilities Investor (BULIX - Free Report) invests a large portion of its assets in equities related to the utilities industry. BULIX’s portfolio is constructed based on quantitative and qualitative management techniques. The American Century Utilities Investor fund has a three year annualized return of 8.2%.
BULIX has an expense ratio of 0.67% as compared to category average of 1.18%.
Kinetics Alternative Income Advisor A (KWIAX - Free Report) seeks to provide current income. KWIAX invests a lion’s share of its assets in the Alternative Income Portfolio, a series of Kinetics Portfolios Trust that holds a portfolio of primarily fixed income securities. The Kinetics Alternative Income Advisor A is non-diversified fund and has a three year annualized return of 4.1%.
As of March 2015, KWIAX held 754 issues, with 9.67% of its total assets invested in iShares 1-3 Credit Bond
Putnam Global Telecommunication A invests a major portion of its assets in common stocks of both large and mid-sized companies throughout the world. PGBZX invests in companies involved in the manufacturing or selling of communication services or communication equipment. PGBZX uses derivative instruments for both hedging and non-hedging purposes. The Putnam Global Telecommunication A is non-diversified fund and has a three year annualized return of 14.5%.
PGBZX has an expense ratio of 1.29% as compared to category average of 1.32%.
To view the Zacks Rank and past performance of all utilities 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. Pick the best mutual funds with the Zacks Rank.