Mutual funds investing in debt securities are among the most secure investment options which provide regular income while protecting capital invested. Funds of this nature bring a great deal of stability to portfolio which a large proportion of equity, while providing dividends more frequently than individual bonds. U.S government bonds funds usually invest in Treasury bills, notes and securities issued by government agencies. They are considered to be the safest in the bond fund category and are ideal options for the risk-averse investor.
Below we will share with you the 5 highest yielding Zacks #1 ranked government bond mutual funds. Each has earned a Zacks #1 Rank (Strong Buy) as we expect these mutual funds to outperform their peers in the future. To view the Zacks Rank and past performance of all government bond funds, investors can click here to see the complete list of funds.
Sec 30 Day Yield
Franklin Real Return A
Vanguard Long-Term Treasury
Fidelity Spartan Long-Term Treasury Index
MassMutual Select Strategic Bond A
Calvert Long Term Income A
Franklin Real Return A (FRRAX) invests in investment grade debt instruments. A maximum of 20% of its assets may be invested in debt instruments rated below investment grade. A maximum of 25% may also be used to purchase foreign securities. The government bond mutual fund returned 2.49% over the last one year period.
The government bond mutual fund has a minimum initial investment of $1,000 and an expense ratio of 0.90% compared to a category average of 0.81%.
Vanguard Long-Term Treasury (VUSTX) seeks consistent and high income. A majority of its investments are made in U.S. Treasury securities. The fund’s portfolio aims to maintain an average maturity period between 15 and 30 years. The government bond mutual fund returned 5.24% over the last one year period.
As of March 2013, this government bond mutual fund held 30 issues, with 9.17% of its total assets invested in US Treasury Bond 4.375%.
Fidelity Spartan Long-Term Treasury Index (FLBAX) invests the majority of its assets in securities included in Barclays Capital U.S. Long Treasury Bond Index. The average maturity period of the fund’s portfolio is 10 years or higher. The government bond mutual fund returned 7.12% over the last one year period.
The Fund Manager is Curt Hollingsworth and he has managed this government bond fund since 2009.
MassMutual Select Strategic Bond A (MSBAX) seeks high return on fixed income instruments. The fund invests in fixed income securities which are denominated in U.S. dollars. These securities can be in domestic or foreign in nature and may be backed by the U.S. government or its agencies. The government bond mutual fund returned 6.04% over the last one year period.
The government bond mutual fund has an expense ratio of 1.13% compared to a category average of 0.89%.
Calvert Long Term Income A (CLDAX) invests a minimum of 65% of assets in U.S. dollar-denominated debt securities. A maximum of 35% of its assets may be parked in high-yield debt securities. The government bond mutual fund returned 11.68% over the last one year period.
The Fund Manager is Matthew Duch and he has managed this government bond fund since 2011.
To view the Zacks Rank and past performance of all government bond mutual funds, investors can click here to see the complete list of funds.
About Zacks Mutual Fund Rank
By applying the Zacks Rank to mutual funds, investors can find funds that not only outpaced the market in the past but are also expected to outperform going forward. Learn more about the Zacks Mutual Fund Rank at http://www.zacks.com/funds.
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