Balanced funds offer investors 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.
The fund managers also enjoy the flexibility of changing 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 to maximize gains, whereas a downturn will see them shifting loyalties toward fixed-income investments to stem losses.
Below, we share with you three top-ranked balanced mutual funds, viz. State Farm Balanced Fund STFBX, George Putnam Balanced Fund PGEOX and Fidelity Balanced Fund FBALX. Each has a Zacks Mutual Fund Rank #1 (Strong Buy) and is expected to outperform its peers in the future. Investors can click here to see the complete list of funds.
State Farm Balanced Fund invests most of its net assets in equity securities of preferably large and medium-cap companies. STFBX advisors consider large and medium-cap companies as defined by S&P Dow Jones Indices at the time of investment.
State Farm Balanced Fund has three-year annualized returns of 6.0%. As of the end of December 2023, STFBX had 8.4% of its net assets invested in Apple.
George Putnam Balanced Fund invests most of its net assets in a portfolio of bonds and common stocks. PGEOX advisors generally invest in common stocks of large-cap domestic companies with growth or value or both characteristics.
George Putnam Balanced Fund has three-year annualized returns of 5.3%. PGEOX has an expense ratio of 0.47%.
Fidelity Balanced Fund invests most of its net assets in stocks and other equity securities.FBALX also invests a small portion of its assets in high-yield debt securities or junk bonds and other lower-quality debt securities.
Fidelity Balanced Fund has three-year annualized returns of 5.1%. Steven Kaye has been one of the fund managers of FBALX since the end of September 2008.
To view the Zacks Rank and the past performance of all balanced mutual funds, investors can click here to see the complete list of funds.
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