Investors often seek solace in precious metals instruments during a downturn. These investments are considered to be a natural hedge against a rapidly declining currency. Even a small portion of precious metals in a portfolio can provide significant protection against inflation. In addition, when markets are slowing down, securities related to these industries acquire greater significance. At such times they provide better returns than equity securities, even outperforming them. Precious metals 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. To view the Zacks Rank and past performance of all precious metals funds, investors can click here to see the complete list of funds.
First Eagle Gold A (SGGDX) invests directly in gold and other precious metals. The fund may also invest in financial instruments issued by companies principally engaged in the gold industry, including gold finance companies. This precious metals mutual fund is non-diversified has a ten year annualized return of 12.32%.
The precious metals mutual fund has a minimum initial investment of $2,500 and an expense ratio of 1.22% compared to a category average of 1.42%.
Tocqueville Gold Fund (TGLDX) seeks long term capital growth by investing a large share of its assets in equity securities of domestic and foreign companies engaged in mining and processing of gold. The fund has exposure to developed as well as emerging markets. The precious metals mutual fund has a ten year annualized return of 14.59%.
As of December 2012, this precious metals fund held 86 issues with 7.80% of its total assets invested in Physical Gold.
Invesco Gold & Precious Metals Investor Fund (FGLDX) invests a majority of its assets in equity securities of companies involved in mining, processing or dealing of precious metals. The fund may also invest directly in gold bullion. The precious metals fund has a ten year annualized return of 13.06%.
The fund manager is Norman MacDonald and she has managed this precious metals mutual fund since 2013.
Rydex Precious Metals Investor Fund (RYPMX) seeks to generate long term capital appreciation by investing a majority of its assets in precious metal companies. The fund also invests in publicly traded derivative contracts. This precious metals mutual fund is non-diversified and has a ten year annualized return of 7.24%