Bonds are the logical choice of investors who are willing to
forgo capital growth for a regular income stream. The cost of
individually purchasing bonds from various categories may become a
particularly expensive proposition. This is why mutual funds are
the most affordable method of investing in bonds. Diversified bond
mutual funds further reduce the risk involved since their
portfolios consist of securities from various classes and sectors.
This ensures that any negative fluctuation in a specific sector
only has a partial effect on the fund's fortunes.
Below we will share with you 5 top rated diversified bond mutual
funds. Each has earned a
Zacks #1
Rank
(Strong Buy) as we expect these mutual funds to outperform their
peers in the future. To view the Zacks Rank and past
performance of all diversified bond funds, investors can
click here to see the complete list of funds
.
MFS Strategic Income A
(
MFIOX
) invests the majority of its assets in debt securities of
different kinds. The fund seeks to acquire domestic and foreign
government securities, asset backed instruments as well as emerging
market securities. The diversified bond mutual fund returned 6.02%
in the last one year period.
The diversified bond mutual fund has an expense ratio of 1.05%
compared to a category average of 1.12%.
MainStay Flexible Bond Opportunities A
(
MASAX
) seeks current income and substantial overall return. At least 65%
of its assets are invested in domestic and foreign debt or related
securities. It may also utilize up to 30% of its assets to purchase
common and preferred stock, rights and warrants. The diversified
bond mutual fund returned 4.86% in the last one year period.
As of February 2012, this diversified bond mutual fund held 401
issues, with 1.76% of its total assets invested in U.S. Treasury
Notes 1.25%.
Federated Strategic Income A
(
STIAX
) invests in three major categories of fixed-income securities.
These include domestic securities rated below investment grade as
well as those rated higher and foreign securities. Not more than
50% of its assets may be invested in any single category. The
diversified bond mutual fund returned 7.12% in the last one year
period.
Joseph M. Balestrino is the fund manager and has managed this
diversified bond mutual fund since 1996.
Virtus Multi-Sector Fixed-Income A
(
NAMFX
) seeks current income and preservation of capital. The fund
utilizes at least 80% its assets to purchase a wide range of fixed
income securities. It purchases U.S. government securities,
investment-grade as well as high yield domestic debt securities.
The diversified bond mutual fund returned 5.68% in the last one
year period.
The diversified bond mutual fund has an expense ratio of 1.16%
compared to a category average of 1.12%.
Columbia Strategic Income A
(
COSIX
) invests in three categories of debt securities. These include,
U.S. government bonds and assets backed securities; foreign
securities, including those issued from emerging markets and
corporate debt rated below investment grade. The diversified bond
mutual fund returned 7.48% in the last one year period.
Laura Ostrander is the fund manager and he has managed this
diversified bond mutual fund since 2000.
To view the Zacks Rank and past performance of all diversified
bond 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
.
View All Zacks #1 Ranked Mutual Funds
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