These are the top 10 best-performing tech-related funds, according to a Morningstar analysis for Business Insider. Investors seeing the Nasdaq perk up are hunting for gains, but at lower risk.
The stock markets have seen a big resurgence since the coronavirus crisis caused a huge sell-off. Many investors may be looking to put money into the market. Tech stock and mutual funds are two time-tested strategies for investing. Below is a list of the top tech-focused mutual and exchange-traded funds based on their performance over the last five years, as compiled by Morningstar Direct for Business Insider. Click here for more BI Prime stories.
If you're like many investors, the return of the Nasdaq to record territory and the rebound of other stock indices in recent weeks following the coronavirus sell-off may have you itching to put some money back into the market. But you may be wondering where exactly to put it. It's no secret that many investors have a preference for tech stocks. In recent years, these often high-growth companies have frequently outperformed the broader markets. It's also no secret that many people prefer to spread their bets or offload their investment decisions to professional managers by investing through mutual funds or exchange traded funds — mutual funds that trade like stocks — rather than buying shares of individual companies. So, if that's you, which funds should you be looking at? Well, a good place to start can be to look at those funds that have performed best over a decent period of time. As fund managers say all the time, past performance is no guarantee of future returns. But it can be an indication, particularly if a fund has done well through both ups and downs in the economic cycle. Analysts at Morningstar Direct put together for Business Insider a list of the mutual funds and ETFs that had posted the best returns over the last five years. That time period stretched through May 31, so it includes the hit the markets took from the coronavirus crisis and the partial recovery through that date. Many investors lately have been plowing their money into passively managed funds, whose holdings typically mirror particular indices. But the top four tech funds over the last five years were all actively overseen by human portfolio managers. Among the firms that posted top returns: ARK Investment Management, BlackRock, and Putnam. The return figures take into account any management or administrative fees the funds assess, but do not include charges that would be incurred when buying or selling the funds. The figures also assume that any dividends or cash distributions would have been reinvested in the fund. In reverse order, here are the top 10 performing tech-funds from the past five years: 10. Berkshire Focus Fund Ticker: BFOCXFive-year average annualized return: 21.06%Management: ActiveManager: Malcolm R. FobesTop five holdings (as of 12/31/19): Alibaba, Apple, Microsoft, AMD, Nvidia 9. Invesco Dynamic Software ETF Ticker: PSJFive-year average annualized return: 21.1%Management: PassiveBenchmark index: Dynamic Software IntellidexTop five holdings (as of 6/4/20): DocuSign, Snap, Liberty Broadband, Adobe, Microsoft 8. Janus Henderson VIT Global Technology and Innovation Portfolio Ticker: JGLTXFive-year average annualized return: 21.15%Management: ActiveManagers: Denny Fish, Garth YettickTop five holdings (as of 4/30/20): Microsoft, Apple, Amazon, Adobe, Mastercard 7. iShares PHLX Semiconductor ETF Ticker: SOXXFive-year average annualized return: 21.59%Management: PassiveBenchmark index: PHLX Semiconductor Sector Top five holdings (as of 6/4/20): Nvidia, Intel, Broadcom, Texas Instruments, Qualcomm 6. Fidelity Select Software and IT Services Portfolio Ticker: FSCSXFive-year average annualized return: 21.81%Management: ActiveManager: Ali KhanTop five holdings (as of 3/31/20): Microsoft, Adobe, Visa, Salesforce, PayPal 5. iShares Expanded Tech-Software Sector ETF Ticker: IGVFive-year average annualized return: 21.99%Management: PassiveBenchmark index: S&P North American Expanded Technology SoftwareTop five holdings (as of 6/4/20): Adobe, Microsoft, Salesforce, Oracle, Intuit 4. Putnam Global Technology Fund Ticker: PGTYXFive-year average annualized return: 22.56%Management: ActiveManagers: Di Yao, Neil DesaiTop five holdings (as of 4/30/20): Microsoft, Visa, Adobe, Nvidia, Fidelity National Information Services 3. BlackRock Technology Opportunities Fund Ticker: BGSIXFive-year average annualized return: 23.45%Management: ActiveManager: Tony KimTop five holdings (as of 4/30/20): Microsoft, Apple, Amazon, Tencent, Alibaba 2. ARK Innovation ETF Ticker: ARKKFive-year average annualized return: 25.87%Management: ActiveManager: Catherine D. WoodTop five holdings (as of 6/5/20): Tesla, Square, Invitae, Crispr Therapeutics, Zillow 1. ARK Next Generation ETF Ticker: ARKWFive-year average annualized return: 30.88%Management: ActiveManager: Catherine D. WoodTop five holdings (as of 6/5/20): Tesla, Square, Roku, Zillow, 2U Got a tip about the tech industry or tech investing? Contact Troy Wolverton via email at firstname.lastname@example.org, message him on Twitter @troywolv, or send him a secure message through Signal at 415.515.5594. You can also contact Business Insider securely via SecureDrop.
Read more about tech investing: Enterprise software companies aren't immune to COVID, and experts warn investors are underestimating how many customers might demand price cuts or peel away We'll never see another $100 billion technology Vision Fund — from SoftBank or anyone else A $6.4 billion market to buy and sell stakes in venture capital funds is completely frozen, and some investors in VC funds could just walk away from their stakes Airbnb was supposed to ignite a boom of tech startup direct listings, but then the coronavirus killed the IPO market SEE ALSO: A Silicon Valley lawyer who works on tech offerings thinks the IPO window could reopen later this year. But he says only a very small group of companies will be able to go public. Join the conversation about this story » NOW WATCH: What makes 'Parasite' so shocking is the twist that happens in a 10-minute sequence
More like this (3)
GOLDMAN SACHS: These 40 heavily shorted stocks could be the next GameStop if retail traders target them — and the group has already nearly doubled over the past 3 months
Summary List PlacementThe GameStop short squeeze and stock bonanza might have felt like a once-a-decade or...Summary List PlacementThe GameStop short squeeze and stock bonanza might have felt like a once-a-decade or once-in-a-lifetime event, but Goldman Sachs says it could happen again, and soon. Even if there were many ways the social media-fueled frenzy in GameStop and AMC Networks and Bed Bath & Beyond was unique, many of its most notable ingredients are still there, according to Goldman Sachs. Chief...
Summary List PlacementHello everyone! Welcome to this weekly roundup of Investing stories from deputy editor Joe Ciolli....Summary List PlacementHello everyone! Welcome to this weekly roundup of Investing stories from deputy editor Joe Ciolli. Please subscribe here to get this newsletter in your inbox every week. Hello and welcome to Insider Investing. I'm Joe Ciolli, and I'll be shepherding you through what to expect in markets in the coming weeks, while also featuring some of Insider's best work on the subject. Regular readers...
The founder of the world's first vegan ETF explains how her market-beating fund is naturally built to include the pandemic's biggest winners — and why industry titans like Facebook and Uber fit the bill
Summary List PlacementWhen the unique VEGN ticker hit the New York Stock Exchange in September 2019,...Summary List PlacementWhen the unique VEGN ticker hit the New York Stock Exchange in September 2019, it caught the attention of both financial commentators and investors. The US Vegan Climate exchange-traded fund had the goal of becoming a sustainable alternative to the S&P 500 that was both cruelty-free and climate-conscious. Many analysts and investors speculated about the kind of performance a large-cap passive-fund could...