3 Consumer Staples Funds You Can Bank on for the Months Ahead

The Consumer Staples sector has experienced a notable resurgence in 2025, driven by a combination of economic uncertainty, shifting consumer behaviors and strong corporate performances. The sector’s performance can also be owed to its defensive nature. Market participants have gravitated toward companies offering essential goods and services, which tend to maintain steady demand regardless of economic cycles.The Consumer Staples Select Sector SPDR Fund (XLP), a benchmark for the sector, has reflected this trend, having grown 5.9% as of May 2025. During the period, XLP reached a new one-year high, indicating strong investor confidence. Several consumer staples mutual funds have also demonstrated solid performance. These funds benefit from holding a diversified portfolio of consumer staples companies, providing a buffer against market volatility.The very defensive nature of the stocks that constitute these funds ensures that market volatility does not have a lasting impact on the sector. The word “staples” itself quite efficiently explains that consumers would need them regardless of what transpires. The sector, thus, is fundamentally strong and resistant to the vagaries of the market.Consumer staples may not have the highest earnings growth or year-over-year revenue growth, but the sector has experienced relatively little disruption historically. On the positive side, these stocks make up for modest growth with low price volatility, reliable profits, dividends and defensive positioning. Several companies within the sector have reported strong earnings, underscoring the sector's stability.Hence, astute investors should invest in mutual funds focused on consumer staples at present. Mutual funds, in general, reduce transaction costs and diversify portfolios without an array of commission charges that are mostly associated with stock purchases (read more: Mutual Funds: Advantages, Disadvantages, and How They Make Investors Money).We have thus selected three such mutual funds that boast a Zacks Mutual Fund Rank #1 (Strong Buy), 2 (Buy), have positive three-year and five-year annualized returns, minimum initial investments within $5000 and carry a low expense ratio.Fidelity Select Retailing FSRPX normally invests the majority of its assets in common stocks of companies principally engaged in merchandising finished goods and services primarily to individual consumers. FSRPX uses fundamental analysis of factors such as each issuer's financial condition and industry position, as well as market and economic conditions for its decisions.As of February 2025, the top three holdings for FSRPX were 24.8% in Amazon, 6.2% in Walmart and 6.2% in Lowe’s.FSRPX’s 3-year and 5-year annualized returns are 8.5% and 11.9%, respectively. Its net expense ratio is 0.64%. FSRPX has a Zacks Mutual Fund Rank #1. To see how this fund performed compared to its category, and other 1 and 2 Ranked Mutual Funds, please click here.Fidelity Advisor Consumer Staples FDIGX invests the majority of its assets in securities of companies principally engaged in the manufacture, sale, or distribution of consumer staples. FDIGX uses fundamental analysis of factors such as each issuer's financial condition and industry position, as well as market and economic conditions for its decisions.As of February 2025, the top three holdings for FDGIX were 14.4% in Coca-Cola, 12.9% in Procter & Gamble and 10.3% in Keurig Dr Pepper.FDIGX’s 3-year and 5-year annualized returns are 2.6% and 9.1%, respectively. Its net expense ratio is 0.71%. FDIGX has a Zacks Mutual Fund Rank #2.Fidelity Select Consumer Staples Portfolio FDFAX invests the majority of its assets in securities of companies principally engaged in the manufacture, sale, or distribution of consumer staples. FDIGX uses fundamental analysis of factors such as each issuer's financial condition and industry position, as well as market and economic conditions for its decisions.As of February 2025, the top three holdings for FDFAX were 14.4% in Coca-Cola, 12.9% in Procter & Gamble and 10.3% in Keurig Dr Pepper.FDFAX’s 3-year and 5-year annualized returns are 2.7% and 9.1%, respectively. Its net expense ratio is 0.67%. FDFAX has a Zacks Mutual Fund Rank #2.Want key mutual fund info delivered straight to your inbox?Zacks' free Fund Newsletter will brief you on top news and analysis, as well as top-performing mutual funds, each week. Get it free >>Zacks' Research Chief Names "Stock Most Likely to Double"Our team of experts has just released the 5 stocks with the greatest probability of gaining +100% or more in the coming months. Of those 5, Director of Research Sheraz Mian highlights the one stock set to climb highest.This top pick is among the most innovative financial firms. With a fast-growing customer base (already 50+ million) and a diverse set of cutting edge solutions, this stock is poised for big gains. Of course, all our elite picks aren’t winners but this one could far surpass earlier Zacks’ Stocks Set to Double like Nano-X Imaging which shot up +129.6% in little more than 9 months.Free: See Our Top Stock And 4 Runners UpWant the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Get Your Free (FSRPX): Fund Analysis Report Get Your Free (FDFAX): Fund Analysis Report Get Your Free (FDIGX): Fund Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).Zacks Investment ResearchWeiter zum vollständigen Artikel bei Zacks Weiter zum vollständigen Artikel bei Zacks