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 .
Vanguard Health Care Index Admiral (VHCIX) seeks to provide returns identical to that of the MSCI US Investable Market Index (IMI)/Health Care 25/50 index. The index includes domestic health care companies. The fund invests in almost all or all of the stocks which are included in the index. This healthcare mutual fund is non-diversified and returned 22.78% over the last one year period.
The fund has an expense ratio of 0.14% as compared to category average of 1.38%.
Fidelity Select Health Care (FSPHX) invests a majority of its assets in companies whose principal operations include production, design and sales of health care related products or services. The fund focuses on acquiring common stocks and purchases both domestic and foreign securities depending on factors such as financial strength and economic conditions. This healthcare mutual fund is non-diversified and returned 36.28% over the last one year period.
Edward Lee Yoon is the fund manager and has managed this healthcare mutual fund since 2008.
ProFunds UltraSector Health Care (HCPSX) seeks daily returns which are 150% of the daily return of the Dow Jones U.S. PharmaceuticalsSM 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 Index. This healthcare mutual fund is non-diversified and returned 30.47% over the last one year period.
As of April 2014, this fund held 118 issues with 9.35% of its assets invested in Johnson & Johnson.
Fidelity Select Medical Equipment & Systems (FSMEX) invests a lion's share of its assets in companies that are primarily involved in medical equipment and devices and related technologies sector. The fund invests in both US and non-US companies. This healthcare mutual fund is non-diversified and returned 25.70% over the last one year period.
The fund has an expense ratio of 0.79% as compared to category average of 1.38%.
Fidelity Select Pharmaceuticals (FPHAX) seeks long term capital growth. It invests heavily in firms all over the globe whose primary operations are related to the manufacturing, sale, development or distribution of pharmaceuticals and drugs. The fund invests in the pharma sector taking into consideration the industry position of the issuer and the financial condition. This healthcare mutual fund is non-diversified and returned 29.43% over the last one year period.
Asher Anolic is the fund manager and has managed this healthcare mutual 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 in our Mutual Fund Center .View All Zacks #1 Ranked Mutual Funds
Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free reportGet Your Free (VHCIX): Fund Analysis ReportGet Your Free (FSPHX): Fund Analysis ReportGet Your Free (HCPSX): Fund Analysis ReportGet Your Free (FSMEX): Fund Analysis ReportGet Your Free (FPHAX): Fund Analysis ReportTo read this article on Zacks.com click here.Zacks Investment Research