Conservative investors prefer debt instruments not only because they safeguard the capital invested but also for the regular income flows they provide. Bonds bring a great deal of stability to an equity-heavy portfolio 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
Fidelity Spartan Intermediate Treasury Bond Index
American Century Zero Coupon 2025
Wasatch-Hoisington US Treasury
Dupree Intermediate Government Bond
Rydex Government Long Bond 1.2x Strategy
Fidelity Spartan Intermediate Treasury Bond Index (FIBAX) seeks high current income. The fund utilizes the majority of its assets to purchase securities which are part of the Barclays Capital U.S. 5-10 Year Treasury Bond Index. The government bond mutual fund returned 11.87% over the last one year period.
The government bond mutual fund has an expense ratio of 0.10% compared to a category average of 0.98%.
American Century Zero Coupon 2025 (BTTRX) invests the largest share of its assets in zero-coupon U.S. Treasury securities and their equivalents. Not more than 20% of its assets may be utilized to purchase zero-coupon U.S. government agency securities with AAA ratings. The government bond mutual fund returned 27.13% over the last one year period.
As of March 2012, this government bond mutual fund held 28 issues, with 17.28% of its total assets invested in US Treas Sec Stripped Int Pmt.
Wasatch-Hoisington US Treasury (WHOSX) seeks to provide returns higher than the inflation rate in a business cycle. The fund invests at least 90% of its assets in U.S Treasury securities and repurchase agreements backed by such instruments. The government bond mutual fund returned 36.91% over the last one year period.
Van Robert Hoisington is the fund manager and has managed this government bond mutual fund since 1996.
Dupree Intermediate Government Bond (DPIGX) invests a minimum of 65% of its assets in securities issued by the U.S. government or its agencies. The balance 35% is invested in bank accounts fully insured by the Federal Deposit Insurance Corporation. The government bond mutual fund returned 10.87% over the last one year period.
The government bond mutual fund has an expense ratio of 0.46% compared to a category average of 0.98%.
Rydex Government Long Bond 1.2x Strategy (RYGBX) seeks returns which are 120% of the price movement of U.S. long Treasury bonds. The majority of the funds assets are utilized to purchase U.S. government securities and derivatives. The government bond mutual fund returned 37.49% over the last one year period.
Ryan A. Harder is the fund manager and has managed this government bond mutual fund since 2008.
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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