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Investors often rely on the healthcare sector to safeguard their investments. This is because demand for healthcare services does not vary much with market conditions, and investments in the sector provide sufficient protection to the capital invested.
Many pharmaceutical companies also offer regular dividends. Companies that pay out consistent dividends are financially stable and generate consistent cash flows irrespective of market conditions. Mutual funds are perfect choices for investors looking to enter this sector since they possess the advantages of wide diversification and analytical insight.
Below we share with you three top-ranked healthcare mutual funds. Each has earned a Zacks Mutual Fund Rank #1 (Strong Buy)or #2 (Buy) and is expected to outperform its peers in the future. Investors can click here to see the complete list of funds.
Fidelity Select Medical Technology and Devices Portfolio FSMEX fund aims for capital growth. It invests the majority of its assets in companies that are engaged in activities such as research, manufacturing, supply and sale of medical equipment and related technologies etc. The non-diversified fund invests in common stocks and in U.S. and non-U.S. issuers. FSMEX has three-year annualized returns of 16.2%.
FSMEX has an expense ratio of 0.73% compared with the category average of 1.24%.
T. Rowe Price Health Sciences Fund PRHSX is a non-diversified fund that invests more than 80% of its assets in common stocks of companies engaged in various activities in the field of healthcare, medicine or life sciences. The fund mostly invests in mid- and large-capitalization companies. PRHSX has three-year annualized returns of 11.5%.
Ziad Bakri is the fund manager of PRHSX since 2016.
Invesco Health Care Fund Class A GGHCX seeks long-term appreciation of capital by investing in equity securities of health care companies across the globe. The fund invests the majority of its assets in equity securities of companies engaged in health care-related industries as well as in derivatives and other instruments having economic characteristics similar to such securities. GGHCX has three-year annualized returns of 7.8%.
As of the end of December 2019, GGHCX held 84 issues with 4.6% of its assets invested in UnitedHealth Group Inc (NYSE:UNH).
To view the Zacks Rank and past performance of all healthcare mutual funds, investors can click here to see the complete list of funds.
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