Balanced funds provide investors with the convenience of buying into a single fund rather holding both equity and bond funds. This category of funds also reduces a portfolio’s volatility while providing higher returns than pure fixed income investments. Fund managers of such funds also enjoy the flexibility of varying the proportion of equity and fixed income investments in response to market conditions. An upswing may prompt them to hold a relatively higher share of equity in order to maximize gains; whereas a downturn sees them turning to fixed income investments to stem losses.
Below we will share with you the 5 highest yielding Zacks #1 ranked balanced 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 balanced funds, investors can click here to see the complete list of funds.
Ivy International Balanced A
Buffalo Flexible Income
MFS Diversified Income A
Hartford Balanced Income A
Mairs & Power Balanced
Ivy International Balanced A ( IVBAX) invests in equity and debt securities which are issued from mature economies in Europe and the Asia-Pacific region. The fund invests in companies of all sizes and in government securities rated investment grade. It may also consider investing in emerging economies. The balanced mutual fund has a three year annualized return of 6.92%.
The Fund Manager is John C. Maxwell and he has managed this balanced mutual fund since 2009.
Buffalo Flexible Income (BUFBX) seeks capital appreciation over the long term as well as high current income. The fund invests in a wide spectrum of instruments like common stocks, convertible and non-convertible preferred stocks, convertible and non convertible debt securities, and junk bonds. The balanced mutual fund has a three year annualized return of 14.22%.
The balanced mutual fund has an expense ratio of 1.01% compared to a category average of 0.99%.
MFS Diversified Income A (DIFAX) invests in a large variety of domestic and foreign equity and debt securities. The fund also purchases convertible and emerging market securities and invests in real estate. The balanced mutual fund has a three year annualized return of 14.8%.
As of May 2012, this balanced mutual fund held 942 issues, with 2.45% of its total assets invested in Simon Property Group Inc.
Hartford Balanced Income A (HBLAX) seeks current income. The fund intends to invests 45% of its assets in equity and 55% in fixed income securities. The fund focuses on acquiring common stocks with a track record of regular dividends. A maximum of 20% of the fixed-income allocation may be utilized to purchase junk bonds. The balanced mutual fund has a three year annualized return of 14.36%.
The Fund Manager is Lucius T. Hill, III and he has managed this balanced mutual fund since 2006.
Mairs & Power Balanced (MAPOX) focuses on acquiring common stock, related convertible securities as well as fixed-income securities. The fund focuses on acquiring investment grade fixed-income securities with higher ratings. It may also invest in convertible and non-convertible securities with lower ratings. The balanced mutual fund has a three year annualized return of 14.08%.
The balanced mutual fund has an expense ratio of 0.79% compared to a category average of 0.99%.
To view the Zacks Rank and past performance of all balanced 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.
More From Zacks.com