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.
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 9.54% 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 1.19%.
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 13.02% over the last one year period.
As of February 2013, this balanced mutual fund held 1673 issues, with 0.73% of its total assets invested in Time Warner Inc.
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 12.47% over the last one year period.
Robert I. Gerber is the fund manager and has managed this balanced mutual fund since 2005.
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 11.77% in the last one year period.
The balanced mutual fund has a minimum initial investment of $25,000 and an expense ratio of 0.37% compared to a category average of 0.93%.
Calamos Global Growth & Income A (CVLOX) invests in a wide range of convertible, equity and fixed income instruments issued by different companies across the world. It invests in companies regardless of their market sizes. The balanced mutual fund returned 3.79% in the last one year period.
John Calamos, Sr. is the fund manager and has managed this balanced mutual fund since 1996.
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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