Balanced funds provide investors with the convenience of buying into a single fund rather than 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.
Putnam Dynamic Asset Allocation Balanced A (PABAX) invests 45% to 75% of its assets in equity securities and 25% to 55% in debt instruments. It invests in growth and/or value stocks of companies all over the globe irrespective of their market capitalizations. It also invests in mortgage-backed instruments. It may also invest in other derivatives including futures, options and swap contracts. The balanced mutual fund has returned 15.26% over the last one year period.
The fund has an expense ratio of 1.02% as compared to category average of 0.93%.
Virtus Tactical Allocation A (NAINX) seeks capital growth with income. It invests 40% to 65% of its assets in equities, 35% to 60% in fixed income instruments and a maximum of 25% of its assets is in vested in cash or cash equivalents. It invests 15% to 50% of its assets in foreign companies, through ADRs. It maintains a dollar weighted duration of maturity of 2 to 8 years. The balanced mutual fund has returned 17.20% over the last one year period.
Frederick L. Brimberg is the fund manager and has managed this fund since 2012.
Federated MDT Balanced A (QABGX) invests around 60% of its assets in equities and 40% in fixed income instruments and other securities including ETFs, foreign securities and hybrid instruments. The allocation may vary by 20% depending on economic and market condition. The balanced mutual fund has returned 16.05% over the last one year period.
The fund has an expense ratio of 1.30% as compared to category average of 0.93%.
T. Rowe Price Balanced (RPBAX) seeks capital appreciation and income. It invests 65% and 35% of its assets in common stocks and fixed income instruments, respectively. It invests a minimum of 25% of its assets in senior fixed income instruments and a maximum of 35% in foreign securities. The balanced mutual fund has returned 15.51% over the last one year period.
As of March 2014, the fund held 1528 issues with 4.40% of its assets invested in T. Rowe Price Instl High Yield.
Eaton Vance Tax-Managed Equity Asset Allocation A (EAEAX) invests a minimum of 65% of its assets in domestic tax managed equities affiliated by the Eaton Vance organization. It may invest a maximum of 25% of its assets in Tax-Managed securities that invest in emerging or small cap firms and a maximum of 35% of its assets in foreign equities. The balanced mutual fund has returned 18.66% over the last one year period.
Lewis R. Piantedosi is the fund manager and has managed this fund since 2013.
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.
Read the analyst report on PABAX
Read the analyst report on NAINX
Read the analyst report on QABGX
Read the analyst report on RPBAX
Read the analyst report on EAEAX
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