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3 Top Utility Mutual Funds for Steady Returns

Investors looking for stable current income would do well to consider utility funds. They are 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. Though this strategy has increased the risk involved, it has also generated higher returns.

Below we will share with you 3 top-rated utility mutual funds . Each has earned a Zacks Mutual Fund Rank #1 (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 .

Fidelity Select UtilitiesFSUTX seeks growth in capital. FSUTX invest the majority of its assets in securities of companies primarily involved in the utilities industry and companies deriving a large portion of their revenues from their utility operations. FSUTX offers dividends & capital gains twice a year in April and December. Fidelity Select Utilities is a non-diversified fund and has a three-year annualized return of 9.2%.

FSUTX has an expense ratio of 0.78% as compared to the category average of 1.12%.

Putnam Global Utilities APUGIX invests mostly in common stocks of large and midsize companies across the globe. PUGIX invests a major portion of its assets in securities of companies predominantly involved in the utilities industry. PUGIX seeks capital growth and current income. Dividends are distributed quarterly. Capital gains are distributed annually. Putnam Global Utilities A has a three-year annualized return of 6.2%.

William Rives is the asset manager since May 12, 2017.

Vanguard Utilities Index AdmiralVUIAX seeks to track the performance of the MSCI US Investable Market Index (IMI)/Utilities 25/50, an index made up of stocks of large, mid-size, and small U.S. companies within the utilities sector. Vanguard Utilities Index Admiral is a non-diversified fund and has a three-year annualized return of 12.4%.

VUIAX has an expense ratio of 0.1% as compared to the category average of 1.12%.

To view the Zacks Rank and past performance of all utility mutual funds, investors can click here to see the complete list of funds .

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.


The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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