Top 5 Best Performing Energy Mutual Funds (June 2011)

By Jun 10, 2011, 10:57 AM Author's Blog  

Mutual funds investing in energy and natural resources are excellent long term prospects and should be part of all well diversified portfolios. This is borne out by the fact that in the last five years, natural resources funds have outperformed the next closest domestic equity fund category by a huge margin. Most of this success is attributable to the oil and natural gas sectors where fast depleting reserves coupled with rising demand have led to a steady increase in both commodity and stock prices. Energy mutual funds greatly reduce the risk involved in investing in this sector because they hold widely diversified portfolios..

Below we will share with you the 5 best performing energy funds year to date.

Mutual Fund Zacks Rank Total Return YTD
ProFunds Ultra Sector Oil & Gas Investor #1 Strong Buy 27.6%
ProFunds Oil Equipment Services & Distribution #3 Hold 22.9%
Vanguard Energy Index #1 Strong Buy 18.5%
Fidelity Select Energy Portfolio #1 Strong Buy 18.5%
Fidelity Select Energy Services #2 Buy 17.5%

ProFunds UltraSector Oil & Gas Investor (ENPIX) seeks to return daily investment results which are one and a half times the daily performance of the Dow Jones U.S. Oil & Gas Index. The fund primarily purchases equity securities and derivatives whose daily returns correspond to its investment objectives. The energy mutual fund has a ten year annualized return of 9.18%.

The fund manager is Todd Johnson and he has managed this energy mutual fund since 2008.

ProFunds Oil Equipment Services & Distribution (OEPSX) invests the majority of its assets in equity securities which are included in the Dow Jones U.S. Oil Equipment, Services & Distribution index. It may also purchase securities with similar economic characteristics. The energy mutual fund returned 50.83% over the last one year period.

The energy mutual fund has a minimum initial investment of $15,000 and an expense ratio of 2.80% compared to a category average of 1.82%.

Vanguard Energy Index (VENAX) seeks to mimic the performance of the MSCI U.S. Investable Market Energy 25/50 Index. The index consists of securities of domestic energy companies of different market capitalizations. This energy mutual fund has a five year annualized return of 8.69%.

The fund manager is Jeffrey D. Miller and he has managed this energy mutual fund since 2010.

Fidelity Select Energy (FSENX) invests the majority of its assets in equity securities of companies whose principal operations are related to the energy sector. The fund invests in both conventional energy companies and those focusing on newer sources. The energy mutual fund returned 37.22% over the last one year period.

As of March 2011, this energy mutual fund held 71 issues, with 14.43% of its total assets invested in ExxonMobil Corporation.

Fidelity Select Energy Services (FSESX) seeks capital growth. The fund invests a large proportion of its assets in companies from the energy services domain. These companies could provide services to both conventional and alternative energy firms. The energy mutual fund is non-diversified and has a ten year annualized return of 9.3%.

The energy mutual fund has a minimum initial investment of $2,500 and an expense ratio of 0.85% compared to a category average of 1.82%.

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

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 at http://www.zacks.com/funds/mutualfunds.

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