Risk lovers seeking healthy returns over a fairly long investment horizon may opt for technology mutual funds. The technology sector is believed to be poised for a brighter earnings performance than others owing to innovation and greater demand. Improving industry fundamentals and emerging technologies — such as wearable’s, VR headsets, drones, virtual reality devices and artificial intelligence — are the key catalysts for the sector.
Meanwhile, most mutual funds investing in securities from these sectors prefer a growth-oriented approach, focusing on companies with strong fundamentals and relatively higher investment prospects. Technology now has broader coverage than just hardware and software companies. Social media and Internet companies are also part of the technology landscape today.
Fidelity Select Semiconductors Portfolio seeks to achieve capital growth by investing most of its assets in common stocks of companies that produce or sell semiconductors and related components. FSELX pays dividends and capital gains twice a year, in April and December.
Fidelity Select Semiconductors Portfolio has three-year annualized returns of 37.2%. As of November 2022, FSELX held 39 issues, with 23.2% of its assets invested in NVIDIA.
DWS Science and Technology Fund seeks to achieve capital appreciation by investing its assets in technology firms based out of the United States. It chooses technological businesses with strong and sustained profit growth, broad and expanding markets, market-leading products, and solid financial standing after conducting in-depth research. KTCAX distributes dividends and capital gains in December.
DWS Science and Technology Fund has three-year annualized returns of 15.6%. Sebastian P. Werner has been one of the fund managers of KTCAX since November 2017.
T. Rowe Price Science and Technology Fund seeks long-term capital growth by investing its assets in common stocks of businesses that its advisors believe will gain from the advancement, usage, and development of science and technology. PRSCX declares dividends every December.
T. Rowe Price Science and Technology Fund has three-year annualized returns of 14.6%. PRSCX has an expense ratio of 0.84% compared with the category average of 1.05%.
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3 Technology Mutual Funds for Outstanding Returns
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