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Technology stocks rise

Equity Funds

The Best Technology Mutual Funds

Bob Ciura Nov 19, 2015

For investors interested in gaining exposure to the technology sector, here are some top mutual funds that focus on technology stocks.

Top Technology Mutual Funds

The T. Rowe Price fund takes a slightly different approach. It focuses its portfolio more highly on social media and Internet stocks, as Amazon (AMZN) and LinkedIn (LNKD) are among its top holdings. It also is more highly concentrated than many other funds, as its top 10 holdings represent 54% of the portfolio. When this is the case, management skill becomes paramount. Investors should take comfort that the portfolio manager has picked good stocks, as the fund has significantly outperformed its peer group so far this year.

The AllianzGI fund has had more-muted returns than its competitors this year, but looking back further, it has performed very well. The fund has achieved a 20% average return over the past three years, placing it near the top of its category. However, investors will have to pay a steep price for such strong performance. The fund carries an annual expense ratio more than double some of its peers, which is something investors should keep in mind. Like the T. Rowe Price fund, the AllianzGI fund is highly concentrated. The top 10 holdings make up 52% of its total portfolio, as it has made savvy bets on Amazon, Facebook and Microsoft (MSFT).

Like the AllianzGI fund, the BlackRock fund carries a higher expense ratio than many others because it, too, takes a specialized approach. The fund targets underdeveloped nations more so than many of its peers. For example, the fund may invest as much as 25% of its net assets in emerging economies. This has paid off in the form of double-digit returns so far in 2015. Over the past one year, the fund has returned nearly 20%.


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