Over the years, studies have consistently shown that investing in both domestic equities and foreign stocks reduces portfolio risk while enhancing returns. In addition, the primacy of the US equity markets has greatly diminished with its share of global stock market capitalization declining steadily. This is why investors can no longer limit themselves to domestic investments. By holding widely diversified portfolios, selected after careful research, global mutual funds offer a secure and attractive opportunity for investors.

Below we will share with you 5 top global mutual funds. Each has earned either a Zacks #1 Rank (Strong Buy) or a Zacks #2 Rank (Buy) as we expect these mutual funds to outperform their peers in the future. To view the Zacks Rank and past performance of all global funds, investors can click here to see the complete list of funds.

Fidelity Advisor Dividend Growth A (FADAX - MF report) invests a major portion of its assets in equities of dividend paying companies located throughout the globe including from the U.S. The fund uses a “blend” strategy to invest in common stocks of companies. Factors including financial strength and economic conditions are considered for investment purpose. The global mutual fund returned 11.2% over the last one year period.

Ramona Persaud is the fund manager and has managed the fund since 2014.

MFS Global Equity A (MWEFX - MF report) seeks capital growth over the long run. The fund invests a lion’s share of its assets in equity securities such as common stocks, preferred stocks and depositary receipts. It may also invest in real estate investment trusts (REITs). It focuses on acquiring stocks of companies having strong earnings growth prospect and are believed to be undervalued. The global mutual fund returned 7.9% over the last one year period.

The fund has an expense ratio of 1.22% as compared to category average of 1.31%.

Guinness Atkinson Global Innovators (IWIRX - MF report) invests in equity securities of companies that are believed to gain from advancement in technology, communications, globalism or innovative management fields. It invests in companies from developed stock markets across the world and in emerging economies in the Far East. The fund invests a minimum of 40% of its assets in global companies. The non-diversified global mutual fund returned 12.1% over the last one year period.

As of December 2014, this fund held 31 issues with 3.68% of its assets invested in Oracle Corporation (ORCL).

American Century Global Growth Investor (TWGGX - MF report) seeks long-term capital appreciation. The fund invests in companies from developed nations all over the globe including U.S. It allocates its assets across companies that are believed to have above-average growth potentials. The global mutual fund returned 9% over the last one year period.

The fund has an expense ratio of 1.08% as compared to category average of 1.31%.

Vanguard Global Equity Investor (VHGEX - MF report) uses bottom-up stock analysis to invest a large share of its assets in equities of companies all over the globe. It invests in both “growth” and “value” companies irrespective of their market capitalizations. The fund also diversifies its allocation across different industries. The global mutual fund returned 7.8% over the last one year period.

As of December 2014, this fund held 761 issues with 1.27% of its assets invested in Royal Caribbean Cruises Ltd.(RCL)