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.
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, investors can click here to see the complete list of funds.
WesMark Balanced (WMBLX) seeks income and capital growth. The fund invests in a portfolio consisting of equity, fixed-income securities and money market instruments. It focuses on allocating its equity component to common stocks of large and mid-cap companies and may invest in ETFs. The balanced mutual fund returned 9.47% in the last one year period.
The balanced mutual fund has a minimum initial investment of $1,000 and an expense ratio of 1.31% compared to a category average of 1.00%.
Davis Appreciation & Income A (RPFCX) invests in common stock and preferred stock, bonds as well as cash. The fund focuses on investing in domestic firms, but may also invest in foreign companies. It selects common stock issued by growth oriented companies, regardless of their size. The balanced mutual fund returned 4.14% in the last one year period.
The fund manager is Andrew Adams Davis and he has managed this balanced mutual fund since 1993.
Mairs & Power Balanced (MAPOX) seeks both capital growth and current income. It 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. The balanced mutual fund returned 17.57% in the last one year period.
The balanced mutual fund has a minimum initial investment of $2,500 and an expense ratio of 0.79% compared to a category average of 1.00%.
State Farm Balanced (STFBX) invests 60% to 75% of its assets in common stocks. At least 25% of its assets are used to purchase fixed income securities. This includes preferred stock and debt securities with longer maturity periods; rated investment grade. The balanced mutual fund returned 7.10% in the last one year period.
As of September 2012, this balanced mutual fund held 273 issues, with 4.03% of its total assets invested in Walt Disney Co.
Lord Abbett Balanced Strategy A (LABFX) seeks both current income and capital appreciation. The fund invests in a combination of underlying funds which in turn invest in stocks, bonds and money market instruments. This balanced mutual fund returned 12.74% over the last one year period.
The fund manager is Robert I. Gerber and he has managed this balanced mutual fund since 2005.
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.
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