5 Best-Performing Health Care Mutual Funds Of Q1

In the first quarter, among the three major U.S. indexes, both the Dow and the S&P 500 finished in the red. Although healthcare was one such S&P 500 sector that registered declines in the first quarter, it surpassed all the other sectors to witness highest venture capital funding.

Such a high level of venture capital funding in the healthcare sector indicated that innovation will reach exponential level. This is why investing in mutual funds with significant exposure to the healthcare sector could be one of the most suitable investment options at present.

Why Invest in Healthcare Mutual Funds?

After strong growth in the first month of this year, all the three indexes entered correction territory in February and then registered a sharp decline in March following the tech slump and trade war fears.Moreover, Wall Street’s “fear gauge,” the Cboe Volatility Index, surged 81% in the first quarter, marking its biggest quarterly increase since 2011, according to the WSJ Market Data Group.

Among the key S&P 500 sectors, only consumer discretionary and technology managed to end in the green, while the remaining finished in negative territory. Despite closing in the red, the healthcare industry raised venture capital of $6.85 billion in the first quarter of this year, accounting for 26.6% of the total venture capital funds, per a Dow Jones VentureSource report.

Venture capital funding in the healthcare sector rose 21% from last year’s fourth-quarter figure and 4% year over year, with Pacific Northwest being the major contributor. Bio-pharma companies constituted around 50% of the total venture capital funding, boosted by innovations in gene editing and cell therapies.

Top 5 Healthcare Mutual Funds to Buy

The aforementioned bullish factors call for investing in healthcare funds. We have, thus, selected five strong performing healthcare mutual funds. These funds have given impressive one-year annualized and year-to-date (YTD) returns. These funds boast a Zacks Mutual Fund Rank #1 (Strong Buy) or 2 (Buy), offer a minimum initial investment within $5,000 and carry a low expense ratio.