Risk lovers seeking healthy returns over a fairly long investment horizon may opt for technology mutual funds. It is believed that the technology sector is poised for a brighter earnings performance than others owing to innovation and greater demand. Improving industry fundamentals and emerging technologies — such as wearables, VR headsets, drones, virtual reality devices and artificial intelligence — are the key catalysts for the sector.
Mutual Funds
Meanwhile, most mutual funds investing in securities from these sectors prefer a growth-oriented approach that includes focusing on companies with strong fundamentals and a relatively higher investment prospect. Moreover, technology now has broader coverage than just hardware and software companies. Social media and Internet companies are also part of the technology landscape today.
Below we share with you three top-ranked technology mutual funds, viz., T. Rowe Price Global Technology Fund PRGTX, Fidelity Select Computers Portfolio FDCPX, and BlackRock Technology Opportunities Fund Investor A Shares BGSAX. 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 funds.
T. Rowe Price Global Technology Fund aims for long-term capital growth. PRGTX invests most of its assets in the common stocks of companies that its managers expect will generate the majority of their revenues from the development, advancement and use of technology. PRGTX usually invests in a minimum of five countries, and invests about one-fourth of its assets in non-U.S. companies.
T. Rowe Price Global Technology Fund has three-year annualized returns of 44.1%. PRGTX has an expense ratio of 0.86% compared with the category average of 1.05%.
Fidelity Select Computers Portfolio aims for capital appreciation. FDCPX invests the majority of its assets in securities of companies primarily engaged in research, design, development, manufacture or distribution of products and services related to currently available or experimental hardware technology in the computer industry.
Fidelity Select Computers Portfolio has three-year annualized returns of nearly 26.6%. Caroline Tall is the fund manager of FDCPX since 2017.
BlackRock Technology Opportunities Fund Investor A Shares aims for long-term capital appreciation. BGSAX invests the majority of assets in equity securities issued by domestic as well as foreign technology companies across all market capitalization ranges. Such companies are selected by BlackRock Technology Opportunities Fund Investor A Shares primarily for their rapid and sustainable growth potential from the development, advancement and use of technology.
BlackRock Technology Opportunities Fund Investor A Shares has three-year annualized returns of 41.1%. As of the end of September 2021, BGSAX held 136 issues with 4.18% 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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