Investment funds that focus on gold and other precious metals bolted back to the top of the performance rankings in March, according to preliminary data released today by Morningstar Canada.

The precious metals fund index posted a gain of 13.7% for the month, bringing its return for the first quarter to 29%, also an industry best. After starting the year with an astounding 18.1% in January, the index stumbled in February with a 3.7% loss.

“Precious metals prices again ascended in March and have by and large outshined oil,” said Morningstar analyst Mark Chow, in a release. “But although gold traded at highs not seen in over 25 years, it has been overshadowed this year by the price of silver, which rose nearly 20% in March and reached 20-year highs as investors anticipate the launch of a new silver-backed ETF.”

Another fund index that has had a see-saw performance pattern so far this year, natural resources posted March’s second best return with 7.6% after suffering a 7.7% loss in the previous month, the worst among all fund indices. Its year-to-date return now stands at 11%.

Overall this was a very positive month for investment funds in Canada, as all but one of the 31 Morningstar Canada fund indices posted gains in March, including 13 indices above the 4% mark. Again this is in sharp contrast to February’s results, when only two indices posted gains above 1% and 20 indices lost value.

Foreign equity funds contributed in no small part to this wave of good fortune. The European equity fund index was up 6.5% and ranked third in March, edging out Japanese equity and Asia/Pacific Rim equity, which gained 6.4% and 6.2% respectively. U.S. small and mid cap equity funds also did very well, collectively gaining 6%. Meanwhile, the broadly diversified international equity and global equity indices climbed 5.4% and 4.9% respectively. The large-cap-focused U.S. equity fund index had a one-month gain of 3.7%.

“Many foreign equity funds benefited from rising currencies versus the Canadian dollar and produced strong returns for the month,” Chow explained. “The euro, for instance, rose over 4% against the loonie this month.”

“The Japanese market continues to be volatile, but data coming out of the second largest economy in the world appear to be promising,” Chow added.

Funds that invest in Canadian equities generally trailed their foreign counterparts for the second month in a row, though their performances, driven by the gold and energy sectors, were more than respectable. The Canadian equity fund index gained 3.9% while Canadian equity (pure) added 3.6%. The surprise for the month was the 11% leap by the information technology sector.

For the first quarter of the year, seven fund indices achieved double-digit returns. A distant second to precious metals was the emerging markets equity fund index, which returned 13.6% over the three-month period. European equity ranks third with 11.8%, while Asia Ex-Japan equity and U.S. small and mid cap equity round out the top five with respective gains of 11.6% and 11.2%.

Canadian Bond was the only fund index in the red in March, losing 0.6%. Its 1% loss for the first three months of the year is one of only two negative results for the quarter among the fund indices, the other being foreign bond with a 0.9% drop.

Final performance figures will be published at mid-month.