By creating a diversified portfolio of both stocks and bonds, balanced funds ensure that they harness the inherent strengths of both classes of instruments. Most of the competently managed funds in this category keep the proportion of assets invested in different asset classes flexible and make adjustments in keeping with prevailing market conditions. This ensures that fixed-income securities protect the portfolio from losses during a downturn while equity securities harness maximum gains from a rising market. This category of funds could be an excellent choice for investors seeking both capital growth and steady income.
Below we will share with you 5 top rated balanced mutual funds. Each has earned a Zacks #1 Rank (Strong Buy) as we expect the fund to outperform its peers in the future. To view the Zacks Rank and past performance of all balanced funds, then click here.
Wells Fargo Advantage WealthBuilder Growth Balanced (WBGBX) invests 62% of its assets in equity funds, 33% in bond funds and only 10% in alternative strategy funds. These underlying funds may be both affiliated and non-affiliated. The balanced mutual fund returned 27.39% over the last one year period.
The balanced mutual fund has a minimum initial investment of $1,000 and an expense ratio of 1.50% compared to a category average of 0.85%.
Victory Balanced A (SBALX) seeks to provide current income and capital appreciation over the long term. Between 40 to 75% of the fund’s assets are utilized to purchase equity and convertible securities and at least 25% of its assets are invested in debt and preferred stock. The balanced mutual fund has a five year annualized return of 3.51%.
Lawrence G. Babin is the fund manager and has managed this balanced fund since 2003.
Ivy Balanced A (IBNAX) invests in a diversified portfolio of equity, debt and short term instruments, the composition of which depends on current market conditions. The fund focuses on investing in large and mid-cap companies which pay regular dividends. The balanced mutual fund has a three year annualized return of 6.55%.
As of March 2011, this balanced mutual fund held 131 issues, with 2.95% of its total assets invested in Toyota Motor Credit Corp.
J Hancock Balanced A (SVBAX) seeks current income and capital appreciation over the long term. It invests in a wide range of equity and debt securities. At least 25% of its assets are invested in equity securities. The balanced mutual fund returned 16.91% over the last one year period.
The balanced mutual fund has a minimum initial investment of $2,500 and an expense ratio of 1.17% compared to a category average of 0.99%.
Virtus Balanced A (PHBLX) utilises at least 65% of its assets to purchase domestic and foreign common stocks and fixed income securities. The fund invests in companies regardless of their size and purchases emerging market securities. The balanced mutual fund has a ten year annualized return of 3.87%.
Robert E. Bishop is the fund manager and has managed this balanced fund since 2009.
To view the Zacks Rank and past performance of all balanced mutual funds, then click here.
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.