Top 5 Precious Metals Mutual Funds (April 2011)

By Apr 25, 2011, 11:49 AM Author's Blog  

Investors often gain comfort from precious metals instruments during difficult economic conditions. Securities from this industry are utilized as a natural hedge against a rapidly declining currency. The presence of even a small portion of precious metals in a portfolio can provide sufficient relief from inflationary pressures. Precious metals mutual funds are the best option for investing in this sector since they possess the advantages of professional insight and well-diversified portfolios.

Below we will share with you 5 top rated precious metals mutual funds. Each has earned a Zacks #1 Rank (Strong Buy) as we expect the fund to outperform its peers in the future.

Fidelity Select Gold (FSAGX) invests the majority of its assets in companies whose principal operations are related to gold, and in gold bullion and coins. Up to 25% of the fund’s assets may be invested in gold and other precious metals through a wholly-owned subsidiary. It is non-diversified and a no load fund.

This precious metals mutual fund returned 36.44% in the last one year period.

GAMCO Gold AAA (GOLDX) seeks capital growth over the long term. At least 80% of the fund’s assets are invested in domestic and foreign companies which engage in gold-related activities. A substantial portion of its assets are utilized to purchase foreign securities The precious metals fund has a three year annualized return of 9.48%.

The precious metals fund has a minimum initial investment of $1,000 and an expense ratio of 1.44% compared to a category average of 1.42%.

Midas (MIDSX) invests at least 65% of its assets are invested in companies involved in the mining, processing and distribution of precious metals. Up to 35% of its assets may be invested in companies deriving a share of its revenues from the precious metals sector. This precious metals fund returned 33.76% in the last one year period.

As of September 2010, this precious metals mutual fund held 37 issues, with 8.40% of its total assets invested in Newcrest Mining Ltd.

OCM Gold (OCMGX) seeks capital appreciation. The fund invests in domestic and foreign companies in the gold mining industry. It focuses on purchasing common stocks of gold producers. It may also invest in companies engaged in the production of other precious metals. The precious metals fund has a ten year annualized return of 26.35%.

Greg Orrell is the fund manager and has managed this precious metals mutual fund since 1988.

Van Eck International Investors Gold A (INIVX) invests the majority of its assets are invested in companies whose major operations primary operations consist of activities related to gold. It also invests in financial instruments which are backed by gold and in gold coins and bullion. The precious metals mutual fund has a five year annualized return of 20.3%.

The precious metals mutual fund has a minimum initial investment of $1,000 and an expense ratio of 1.25% compared to a category average of 1.42%.

To view the Zacks Rank and past performance of all precious metals mutual funds, then click here.

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