5 Highest Yielding Zacks #1 Ranked Municipal Bond Mutual Funds
Debt securities will always be the natural choice of the risk-averse investor because this category of instruments provides regular income flow at low levels of risk. Income from regular dividends helps to ease the pain caused by plunging stock prices. When considering safety of capital invested, municipal bond mutual funds are second only to those investing in government securities. In addition, the interest income earned form these securities are exempt from federal taxes and in many cases from state taxes as well.
Below we will share with you the 5 highest yielding Zacks #1 ranked municipal 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 municipal bond funds, investors can click here to see the complete list of funds.
Mutual Fund | Sec 30 Day Yield |
JPMorgan Municipal Income Select | 2.74% |
State Farm Municipal Bond | 2.59% |
Invesco Tax-Free Intermediate A2 | 2.16% |
Capital Group Core Municipal | 2.00% |
JPMorgan Intermediate Tax Free Bond Select | 1.82% |
JPMorgan Municipal Income Select (HLTAX) seeks a high level of current income which is not subject to federal income taxes. The fund invests a large share of its assets in municipal bonds. The average weighted maturity period of its portfolio varies between three to fifteen years. The municipal bond mutual fund has a three year annualized return of 3.20%.
The municipal bond mutual fund has an expense ratio of 0.62% compared to a category average of 0.80%.
State Farm Municipal Bond (SFBDX) focusses on investing in a wide range of municipal bonds. These securities must have maturity periods ranging from one to seventeen years. A minimum of 70% of its assets must be invested in municipal securities with “A” or higher ratings from Moody’s or Standard and Poor’s. The municipal bond mutual fund has a three year annualized return of 3.76%.
The Fund Manager is Robert Reardon and he has managed this municipal bond mutual fund since 1998.
Invesco Tax-Free Intermediate A2 (AITFX) seeks current income which is not subject to federal taxes. The fund invests the majority of its assets in municipal bonds rated investment grade. The average dollar weighted maturity period of its portfolio ranges from three to ten years. The municipal bond mutual fund has a three year annualized return of 4.10%.
The municipal bond mutual fund has a minimum initial investment of $1,000 and an expense ratio of 0.35% compared to a category average of 0.80%.
Capital Group Core Municipal (CCMPX) primarily invests in municipal bonds with intermediate maturity periods. These bonds must have a minimum quality rating of A-. The fund does not purchase securities subject to federal alternative minimum tax. The municipal bond mutual fund has a three year annualized return of 3.05%.
As of July 2013, this municipal bond mutual fund held 334 issues, with 1.13% its total assets invested in New Hampshire Health & Ed Facs Var Rev N.
JPMorgan Intermediate Tax Free Bond Select (VSITX) seeks to return dividends on a monthly basis. The fund invests the majority of its assets in municipal securities the interest from whose gross income is not subject to federal income tax as well as federal alternative minimum tax. The municipal bond mutual fund has a three year annualized return of 2.94%.
The Fund Manager is Richard D. Taormina and he has managed this municipal bond mutual fund since 2006.
To view the Zacks Rank and past performance of all municipal bond 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.
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