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.
Franklin Balanced A (FBLAX) seeks capital growth and income. It 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. This balanced mutual fund returned 9.16% over the last one year period.
The fund has an expense ratio of 1.11% as compared to category average of 0.97%.
Intrepid Capital (ICMBX) seeks capital growth on a long-term basis along with high income. This non-diversified fund mostly invests in undervalued small and mid-cap equity and high yield securities generally with a maturity period ranging between two and six years. This balanced mutual fund returned 13.11% over the last one year period.
Mark I. Travis is the fund manager and has managed this fund since 2005.
Calvert Aggressive Allocation A (CAAAX) is a fund of funds that invests in a number of Calvert fixed-income, equity and money market funds. The fund seeks long-term capital growth and invests in keeping with the established target asset allocation. This balanced mutual fund returned 16.96% over the last one year period.
As of February 2014, this find held 10 issues with 21.50% of its assets invested in Calvert Equity I.
Hartford Balanced Income Fund Class A (HBLAX) seeks current income. The fund aims to invest 45% of its assets in equity securities and 55% in fixed income instruments. A maximum of 20% of its assets are utilized to purchase domestic junk bonds. This balanced mutual fund returned 8.46% over the last one year period.
The fund has an expense ratio of 0.96% as compared to category average of 0.93%.
Meeder Balanced (FLDFX) invests in underlying funds that include domestic or foreign mutual funds and exchange traded funds among others. At least 30% and up to 70% of assets are invested in funds that in turn parks money in equity securities. It may also invest from 30-70% in fixed income securities. This balanced mutual fund returned 13.77% over the last one year period.
As of February 2014, this fund held 99 issues with 6.54% of its assets invested in Putnam Diversified Income Y.
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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Read the analyst report on FBLAX
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