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3 Technology Mutual Funds for Prolific Returns

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Risk lovers seeking healthy returns over a fairly long investment horizon may opt for technology mutual funds. The technology sector is believed to be 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.

Meanwhile, most mutual funds investing in securities from these sectors prefer a growth-oriented approach, focusing on companies with strong fundamentals and relatively higher investment prospects. 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 technology mutual funds, viz., Fidelity Select Semiconductors Portfolio (FSELX - Free Report) , Red Oak Technology Select Fund (ROGSX - Free Report) and DWS Science and Technology Fund (KTCAX - Free Report) . Each has 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.

Fidelity Select Semiconductors Portfolio seeks capital appreciation. FSELX invests most of its assets in common stocks of companies principally engaged in the design, manufacture, or sale of electronic components.

Fidelity Select Semiconductors Portfolio has three-year annualized returns of 26.6%. As of the end of May 2023, FSELX held 40 issues, with 32.2% of its assets invested in NVIDIA Corp.

Red Oak Technology Select Fund seeks long-term capital growth by investing primarily in stocks of companies that rely extensively on technology in their product development or operations, or which may be experiencing growth in sales and earnings driven by technology-related products and services. ROGSX also invests in technology companies that develop, produce, or distribute products or services related to computers, semiconductors and electronics.

Red Oak Technology Select has three-year annualized returns of 7.7%. ROGSX has an expense ratio of 0.94% compared with the category average of 1.05%.

DWS Science and Technology Fund seeks capital appreciation by investing most of its assets in common stocks of U.S. companies in the technology sector. KTCAX advisors use in-depth research to select a diverse portfolio of technology companies that have robust and sustainable earnings growth, large and growing markets, leading products and services and strong balance sheets.

DWS Science and Technology Fund has three-year annualized returns of 6.6%. Sebastian P. Werner has been the fund manager of KTCAX since November 2017.

To view the Zacks Rank and the past performance of all Technology Mutual Funds, investors can click here to see the complete list of Technology funds.

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