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. Permanent Portfolio Class 1 PRPFX, State Farm Balanced Fund STFBX and SEI Multi-Asset Real Return SEIAX. 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.
Permanent Portfolio Class I seeks to preserve and increase the purchasing power value of its shares over the long term by investing most of its net assets in gold, silver,Swiss franc assets, common stocks of real estate and natural resource in various proportions. PRPFX advisors also invest in aggressive growth stocks and in dollar assets.
Permanent Portfolio Class I has three-year annualized returns of 7.6%. As of the end of July 2022, PRPFX had 82 issues and 38.26% of its net assets invested in corporate bonds.
State Farm Balanced Fund invests most of its net assets in common stocks. STFBX advisors prefers to invest in equity securities of large and mid-capitalization companies with market capitalization within the range as defined by S&P Dow Jones Indices at the time of investment.
State Farm Balanced Fund has three-year annualized returns of 6.5%. STFBX has an expense ratio of 0.14% compared with the category average of 0.84%.
SEI Multi-Asset Real Return seeks total returns that exceed the rate of inflation over a full market cycle, regardless of market conditions, by investing most of its net assets in fixed income and equity securities and commodity-linked instruments. SEIAX advisors invests in U.S. and non-U.S. dollar-denominated securities.
SEI Multi-Asset Real Return has three-year annualized returns of 6.6%. Steven Treftz has been one of the fund managers of SEIAX since December 2012.
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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