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.
American Funds Global Balanced A (GBLAX) invests normally in equity securities and debt instruments issued by different companies across the world. These companies must have good growth potential and dividend paying capacity. The fund may also invest in money market instruments. This balanced mutual fund returned 12.60% over the last one year period.
The balanced mutual fund has a minimum initial investment of $250 and an expense ratio of 0.91% compared to a category average of 1.20%.
MainStay Moderate Growth Allocation A (MGDAX) seeks capital appreciation over the long term. The fund aims to meet its objective by investing in mutual funds that are managed by MainStay. The fund invests heavily in underlying equity securities. Around 20% of its assets may be invested in funds that are constituted by fixed income instruments. The balanced mutual fund returned 14.94% in the last one year period.
As of March 2013, this balanced mutual fund held 24 issues, with 17.14% of its total assets invested in MainStay MAP I.
Franklin Balanced A (FBLAX) invests in a range of dividend generating stocks, convertible instruments and debt securities. Not more than 25% of its assets may be utilized to purchase debt securities. This balanced mutual fund returned 11.98% over the last one year period.
Edward Perks is the fund manager and has managed this balanced mutual fund since 2006.
JPMorgan Income Builder A (JNBAX) seeks appreciably high income. The fund invests in a wide range of income yielding domestic and foreign debt and equity securities. It may invest all its assets in securities rated below investment grade. This balanced mutual fund returned 15.48% over the last one year period.
The balanced mutual fund has a minimum initial investment of $1,000 and an expense ratio of 0.74% compared to a category average of 0.91%.
Lord Abbett Growth & Income Strategy A (LWSAX) invests predominantly in domestic equity securities and fixed income instruments as well also in foreign securities. The fund invests in these instruments via mutual funds managed by Lord, Abbett & Co. LLC. The balanced mutual fund returned 15.24% over the last one year period.
Robert I. Gerber 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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