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 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) invests in a portfolio consisting of equity, fixed-income securities and money market instruments. The fund focuses on allocating its equity component to common stocks of large and mid-cap companies and may invest in ETFs. This balanced mutual fund returned 12.82% over the last one year period.
The balanced mutual fund has an expense ratio of 1.27% compared to a category average of 0.98%.
State Farm Balanced (STFBX) seeks principal growth and current income on a long-term basis. The fund invests 60% to 75% of its assets in equity securities of those companies whose market cap is at least $1.5 billion. The remainder is invested in fixed income securities that are backed by the U.S. government. This balanced mutual fund returned 12.47 % over the last one year period.
Paul Eckley is the fund manager and has managed this balanced mutual fund since 1991.
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. This balanced mutual fund returned 21.87% over the last one year period.
The balanced mutual fund has an expense ratio of 1.17% compared to a category average of 0.91%.
Franklin Balanced A (FBLAX) seeks both capital growth and income. The fund invests in dividend yielding stocks, debt securities and convertible instruments. A minimum of 25% of its assets are invested in debt securities. It aims to invest a maximum of 15% of its assets in foreign securities. The balanced mutual fund returned 12.49% over the last one year period.
As of September 2013, this balanced mutual fund held 178 issues, with 1.20% of its total assets invested in Eli Lilly and Company.
Wells Fargo Advantage Growth Balanced (NVGBX) invests in those securities with low volatility and the potential to provide steady returns. At least 65% of its assets are invested in equity while the remainder is invested in fixed income securities. The balanced mutual fund returned 23.72% over the last one year period.
Thomas Biwer is the fund manager and 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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