The tech sector has been the best performing space this year, even amid concerns of stretched valuations. A rising rate environment, improving industry fundamentals, and emerging technologies such as wearables, VR headsets, drones, virtual reality devices, and artificial intelligence are the key catalysts to the sector’s growth, and are responsible for the impressive rise in tech mutual funds.
The major Technology Select Sector SPDR (NYSEARCA:XLK) has increased 19% so far this year and is expected to maintain this bullish trend as the sector enters the Q2 earnings season. Most of the tech aces such as Apple Inc. (NASDAQ:AAPL), Microsoft Corporation (NASDAQ:MSFT), Alphabet Inc (NASDAQ:GOOGL, NASDAQ:GOOG) and Facebook Inc (NASDAQ:FB) are lined up to report this week and in the next.
Below we share with you three top-ranked technology mutual funds. Each has earned a Zacks Mutual Fund Rank #1 (Strong Buy) and is expected to outperform its peers in the future. Investors can click here to see the complete list of technology funds, their Zacks Rank and past performance.
Columbia Global Technology Growth Z (MUTF:CMTFX) invests a large chunk of its assets in companies related to the technology sector. CMTFX invests a minimum of 40% of its assets in foreign companies. Though CMTFX invests in companies irrespective of their market capitalization, it may invest a sizable portion of its assets in small cap companies. Columbia Global Technology Growth Z has returned 28.6% year to date.
Rahul Narang is the fund manager of CMTFX since 2012.
Fidelity Advisor Technology Fund (MUTF:FADTX) seeks growth of capital. FADTX invests a bulk of its assets in common stocks of companies involved in using and developing products and services that have benefited from technological improvements. The fund invests in both U.S. and non-U.S. technology companies. Fidelity Advisor Technology Ahas returned 35.6% year to date.
FADTX has an expense ratio of 1.07% as compared to the category average of 1.50%.
Putnam Global Technology Fund (MUTF:PGTAX) invests the lion’s share of its net assets in securities of technology companies. The fund invests mainly in large- and mid-cap tech companies which are expected to have strong investment prospects. PGTAX seeks appreciation of capital. Putnam Global Technology A has returned 32.2% year to date.
As of March 2017, PGTAX held 77 issues, with 9.69% of its assets invested in Apple Inc.
To view the Zacks Rank and past performance of all technology mutual funds, investors can click here to see the complete list of funds.
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