The U.S. economy has delivered mixed performance so far this month. Consumer spending remains resilient, but softer labor-market conditions and persistent inflation pressures are major headwinds. August retail sales jumped 1.2%, beating expectations, while sales excluding autos and gasoline also remained strong. However, the labor market showed signs of cooling, with private-sector employers adding just 38,000 jobs in August, below expectations. Initial jobless claims remained near 206,000, suggesting that layoffs are still contained. Meanwhile, August PPI rose 0.4% month over month and 5.4% year over year, highlighting continued price pressures.

The Federal Reserve, in its Federal Open Market Committee (FOMC) meeting on Sept. 16, raised interest rates by 25 basis points for the first time in the past three years.  The Fed funds rate is currently in the range of 3.75-4.00%. The move reflects concerns that tariffs and elevated oil prices could keep inflation above the Fed’s 2% goal. Higher rates are likely to keep borrowing costs elevated for households and businesses, potentially slowing spending and investment. Bond yields also remained high, putting pressure on equities. For now, the economy appears to be holding up, but the combination of sticky inflation, expensive energy, and softer hiring makes the road ahead less certain.

Amid such market conditions, investors looking for higher returns over the long term can consider no-load mutual funds, such as Franklin Gold And Precious Metals Fund (FGADX Quick QuoteFGADX - Free Report) , Fidelity Select Semiconductors Portfolio (FSELX Quick QuoteFSELX - Free Report) , Invesco Steelpath Mlp Select 40 Fund (MLPTX Quick QuoteMLPTX - Free Report) and Invesco Small Cap Value (VSMIX Quick QuoteVSMIX - Free Report) , as these have a low expense ratio, which can translate into higher returns. Other factors such as the fund’s performance history, investment style and risk tolerance are also acting in their favor.

Why Choose No-Load Mutual Funds Now?

Investors with disposable income who wish to diversify their portfolios can opt for no-load mutual funds. These passively managed funds don’t have any commission fees or other charges for buying and selling that are generally associated with actively managed funds.

The sales charges — referred to as a “front-end load,” which is charged upon purchasing shares, or “back-end load,” which is charged upon the selling of shares — are absent in such funds because shares are distributed directly by the investment company, instead of any third-party involvement like a broker, advisor or other professionals.

Even a few additional basis points saved in fees can boost the overall return by minimizing expenses. However, charges like the fund’s expense ratio, 12b-1 fees for marketing, distribution, and service, redemption fees, exchange fees, and account fees are commonly charged even if there is no load.

A Hypothetical Example

The load charges are generally within the range of 0-6%. To understand the math, let’s assume an investor wants to invest $1000 in a mutual fund that has a 5% entry and exit load. Then, $950 ($1000-$50 [5% of $1000]) is left with the mutual fund house to invest. Now, let’s assume the fund has given a 15% return over the year. So, the current value of the portfolio is $1092.5 ($950+ $142.5 [15% of $950]). Now, when an exit load of 5% is applied, the investor is left with $1037.87 ($1092.5-$54.63 [5% of $1092.5]).

According to the above hypothesis, the returns earned by investors with front and back loads are 3.78%, whereas they could have enjoyed a much higher return without the load.

We have thus selected four no-load mutual funds that boast a Zacks Mutual Fund Rank #1 (Strong Buy), have positive three-year and five-year annualized returns, minimum initial investments within $5000, and carry a low expense ratio. Notably, mutual funds, in general, reduce transaction costs and diversify portfolios without an array of commission charges primarily associated with stock purchases (read more: Mutual Funds: Advantages, Disadvantages, and How They Make Investors Money).

Franklin Gold And Precious Metals Fund invests most of its net assets in securities of small- and mid-cap gold and precious metals operation companies located anywhere in the world. FGADX advisors prefer to invest in non-U.S. companies, irrespective of their market capitalization.

Steve M. Land has been the lead manager of FGADX since April 1, 1999. Most of the fund’s exposure was to companies like Newmont (5.5%), G Mining Ventures (5.2%) and Alamos Gold (4.9%) as of April 30, 2026.

FGADX’s three-year and five-year annualized returns are nearly 61.8% and 27.2%, respectively. FGADX has an annual expense ratio of 0.58%.

To see how this fund performed compared to its category and other 1, 2, and 3 Ranked Mutual Funds, please click here.

Fidelity Select Semiconductors Portfolio fund invests most of its net assets in common stocks of domestic and foreign companies that are principally engaged in the design, manufacture, or sale of semiconductors and semiconductor equipment. FSELX chooses to invest in stocks based on fundamental analysis factors such as each issuer's financial condition and industry position, and market and economic conditions.

Adam Benjamin has been the lead manager of FSELX since March 16, 2020. Most of the fund’s exposure was to companies like NVIDIA (22.1%), Broadcom (13%) and Marvell Technology (7.8%) as of May 31, 2026.

FSELX’s three-year and five-year annualized returns are nearly 48.4% and 35.2%, respectively. FSELX has an annual expense ratio of 0.60%.

Invesco Steelpath Mlp Select 40 Fund invests most of its assets, along with borrowings, if any, in the master limited partnership of companies, which are engaged in the transportation, storage, processing, refining, marketing, exploration, production, and mining of minerals and natural resources. MLPTX advisors also invest in derivatives and other instruments with similar economic characteristics in the same industry.

Stuart Cartner has been the lead manager of MLPTX since April 1, 2010. Most of the fund’s exposure was in companies like Western Midstream Partners (7.6%), Energy Transfer (7.4%) and MPLX (6.8%) as of May 31, 2026.

MLPTX has a three-year and five-year annualized return of 26% and 24.4%, respectively. MLPTX has an annual expense ratio of 0.82%.

Invesco Small Cap Value fund invests most of its assets, along with borrowings, if any, in common stocks of small-capitalization companies and in derivative instruments with similar economic characteristics. VSMIX advisors choose to invest in companies that they consider undervalued.

Jonathan Mueller has been the lead manager of VSMIX since June 25, 2010. Most of the fund’s exposure was in companies like Coherent Corporation (4.1%), MKS (3%) and Rambus (3%) as of April 30, 2026.

VSMIX’s three-year and five-year annualized returns are 25.5% and 20.4%, respectively. VSMIX has an annual expense ratio of 0.80%.

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