We use cookies to understand how you use our site and to improve your experience. This includes personalizing content and advertising. To learn more, click here. By continuing to use our site, you accept our use of cookies, revised Privacy Policy and Terms of Service.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
4 Low Beta Funds to Buy on Escalating Geopolitical Tensions
Read MoreHide Full Article
Rising geopolitical tensions between U.S. and its international counterparts kept market watchers guessing what’s next in the pipeline. After President Trump’s threat to his Iranian counterpart in a tweet over the weekend, the U.S. Congress is expected to thwart China’s presence and influence in the Pacific Rim by passing a landmark 2019 defense authorization bill.
Further, on Jul 24, the U.S. Secretary of State, Mike Pompeo said in a statement that demolition of ISIS should be the top priority of the Trump administration. Under such circumstances, shielding one’s portfolio from the adverse effects of any geopolitical escalation is of utmost importance. So, investing in low beta mutual funds at this point seems prudent.
U.S. Congress Aims to Thwart China
In a bid to check Chinese encroachment in Asian countries, the U.S. Congress is set to pass a landmark defense authorization bill for 2019. The bill also seeks to press the Pentagon to take a tough stand in strengthening Taiwan’s capabilities to counter invasion from China. The Asian giant has for long claimed the democratic nation as one of its provinces — a tactic used by the country on other nations to emphasize its dominance.
This apart, the United States plans to school China by permanently banning it from any naval exercises in the Pacific Rim. This has been done to force China to stop its military exercises in the South China Sea, which again the country claims as its sovereign territory. China continues to claim the waters as theirs, despite a ruling in 2016 by an international tribunal, which declared such claims as baseless and having no legal standing.
Tensions with EU and Iran Escalate
Trump also warned the European Union of dire consequences if his meeting with EU officials next week doesn’t yield what he considers a fair auto trade deal. Trump has hinted that the U.S. government may raise tariffs on auto products imported from the European Union from 2.5% to 20%.
On Jul 22, Trump tweeted a warning to his Iranian counterpart. The President said Iran would "SUFFER CONSEQUENCES THE LIKES OF WHICH FEW THROUGHOUT HISTORY HAVE EVER SUFFERED BEFORE" if Hassan Rouhani ever threatened the United States again. The tweet was a retaliation to Iranian president Rouhani’s comments that Iran’s power is deterrent,” the country’s enemies must realize “war with Iran is the mother of all wars.”
4 Best Funds to Buy Now
Amid such a high level of uncertainty, it will be prudent to pick safe mutual funds. Such funds are inherently less volatile than the markets they trade in. In this case, a low beta ranges from 0 to 1.
Given such circumstances, we have highlighted four mutual funds carrying a Zacks Mutual Fund Rank #1 (Strong Buy) or 2 (Buy) that are poised to gain from such factors. Moreover, these funds have encouraging three and one-year returns. Additionally, the minimum initial investment is within $5000.
We expect these funds to outperform their peers in the future. Remember, the goal of the Zacks Mutual Fund Rank is to guide investors to identify potential winners and losers. Unlike most of the fund-rating systems, the Zacks Mutual Fund Rank is not just focused on past performance, but also on the likely future success of the fund.
The question here is: why should investors consider mutual funds? Reduced transaction costs and diversification of portfolio without several commission charges that are associated with stock purchases are primarily why one should be parking money in mutual funds (read more: Mutual Funds: Advantages, Disadvantages, and How They Make Investors Money).
T. Rowe Price Ultra Short-Term Bond (TRBUX - Free Report) maintains a diversified portfolio by investing in bonds and other related securities that are rated investment-grade. TRBUX seeks maximization of income by investing mainly in investment-grade government and corporate securities that have low maturity period.
This Sector - Inv Grade Bond-Short product has a history of positive total returns for over 10 years. Specifically, the fund has returned 1.5% over the three-year and 1.1% over the five-year benchmarks. To see how this fund performed compared to its category, and other #1 and 2 Ranked Mutual Funds, please click here.
TRBUXhas a Zacks Mutual Fund Rank #1 and an annual expense ratio of 0.35%, which is below the category average of 0.50%. The fund carries a 3-year beta of 0.06.
Thrivent Limited Maturity Bond Fund Class S (THLIX - Free Report) invests a huge part of its assets in debt securities or preferred stocks that are rated "BBB" or higher by the S&P or rated "Baa" or more by Moody’s. THLIX seeks growth of income together with the stability of principal.
This Sector - Inv Grade Bond-Short product has a history of positive total returns for over 10 years. Specifically, the fund has returned 1.7% over the three-year and 1.7 over the five-year benchmarks. To see how this fund performed compared to its category, and other #1 and 2 Ranked Mutual Funds, please click here.
THLIXcarries a Zacks Mutual Fund Rank #2 and an annual expense ratio of 0.42%, which is below the category average of 0.74%. The fund carries a 3-year beta of 0.21.
Dodge & Cox Income (DODIX - Free Report) seeks to maintain a diversified portfolio by investing a large chunk of its assets in investment-grade debt securities and cash equivalents. The fund targets those debt securities for investment, which are rated BBB- or higher by Fitch Ratings or Standard & Poor's Ratings Group, or Baa3 or better by Moody's Investors Service.
This Sector - Inv Grade Bond-Short product has a history of positive total returns for over 10 years. Specifically, the fund has returned 2.7% over the three-year and 3.1% over the five-year benchmarks. To see how this fund performed compared to its category, and other #1 and 2 Ranked Mutual Funds, please click here.
DODIXhas a Zacks Rank #2 and an annual expense ratio of 0.43%, which is below the category average of 0.76%. The fund carries a 3-year beta of 0.67.
PIA Short Term Securities Advisor (PIASX - Free Report) invests a bulk of its assets in securities that have a duration of three years or lower. The fund generally invests in those securities that are rated Baa3 and/or BBB- or higher by a Nationally Recognized Statistical Rating Organization.
This Sector - Inv Grade Bond-Short product has a history of positive total returns for over 10 years. Specifically, the fund has returned 0.8% each over the three-year and five-year benchmarks. To see how this fund performed compared to its category, and other #1 and 2 Ranked Mutual Funds, please click here.
PIASXhas a Zacks Mutual Fund Rank #2 and an annual expense ratio of 0.39%, which is below the category average of 0.50%. The fund carries a 3-year beta of 0.12.
Want key mutual fund info delivered straight to your inbox?
Zacks’ free Fund Newsletter will brief you on top news and analysis, as well as top-performing mutual funds, each week. Get it free >>
See More Zacks Research for These Tickers
Normally $25 each - click below to receive one report FREE:
Image: Bigstock
4 Low Beta Funds to Buy on Escalating Geopolitical Tensions
Rising geopolitical tensions between U.S. and its international counterparts kept market watchers guessing what’s next in the pipeline. After President Trump’s threat to his Iranian counterpart in a tweet over the weekend, the U.S. Congress is expected to thwart China’s presence and influence in the Pacific Rim by passing a landmark 2019 defense authorization bill.
Further, on Jul 24, the U.S. Secretary of State, Mike Pompeo said in a statement that demolition of ISIS should be the top priority of the Trump administration. Under such circumstances, shielding one’s portfolio from the adverse effects of any geopolitical escalation is of utmost importance. So, investing in low beta mutual funds at this point seems prudent.
U.S. Congress Aims to Thwart China
In a bid to check Chinese encroachment in Asian countries, the U.S. Congress is set to pass a landmark defense authorization bill for 2019. The bill also seeks to press the Pentagon to take a tough stand in strengthening Taiwan’s capabilities to counter invasion from China. The Asian giant has for long claimed the democratic nation as one of its provinces — a tactic used by the country on other nations to emphasize its dominance.
This apart, the United States plans to school China by permanently banning it from any naval exercises in the Pacific Rim. This has been done to force China to stop its military exercises in the South China Sea, which again the country claims as its sovereign territory. China continues to claim the waters as theirs, despite a ruling in 2016 by an international tribunal, which declared such claims as baseless and having no legal standing.
Tensions with EU and Iran Escalate
Trump also warned the European Union of dire consequences if his meeting with EU officials next week doesn’t yield what he considers a fair auto trade deal. Trump has hinted that the U.S. government may raise tariffs on auto products imported from the European Union from 2.5% to 20%.
On Jul 22, Trump tweeted a warning to his Iranian counterpart. The President said Iran would "SUFFER CONSEQUENCES THE LIKES OF WHICH FEW THROUGHOUT HISTORY HAVE EVER SUFFERED BEFORE" if Hassan Rouhani ever threatened the United States again. The tweet was a retaliation to Iranian president Rouhani’s comments that Iran’s power is deterrent,” the country’s enemies must realize “war with Iran is the mother of all wars.”
4 Best Funds to Buy Now
Amid such a high level of uncertainty, it will be prudent to pick safe mutual funds. Such funds are inherently less volatile than the markets they trade in. In this case, a low beta ranges from 0 to 1.
Given such circumstances, we have highlighted four mutual funds carrying a Zacks Mutual Fund Rank #1 (Strong Buy) or 2 (Buy) that are poised to gain from such factors. Moreover, these funds have encouraging three and one-year returns. Additionally, the minimum initial investment is within $5000.
We expect these funds to outperform their peers in the future. Remember, the goal of the Zacks Mutual Fund Rank is to guide investors to identify potential winners and losers. Unlike most of the fund-rating systems, the Zacks Mutual Fund Rank is not just focused on past performance, but also on the likely future success of the fund.
The question here is: why should investors consider mutual funds? Reduced transaction costs and diversification of portfolio without several commission charges that are associated with stock purchases are primarily why one should be parking money in mutual funds (read more: Mutual Funds: Advantages, Disadvantages, and How They Make Investors Money).
T. Rowe Price Ultra Short-Term Bond (TRBUX - Free Report) maintains a diversified portfolio by investing in bonds and other related securities that are rated investment-grade. TRBUX seeks maximization of income by investing mainly in investment-grade government and corporate securities that have low maturity period.
This Sector - Inv Grade Bond-Short product has a history of positive total returns for over 10 years. Specifically, the fund has returned 1.5% over the three-year and 1.1% over the five-year benchmarks. To see how this fund performed compared to its category, and other #1 and 2 Ranked Mutual Funds, please click here.
TRBUXhas a Zacks Mutual Fund Rank #1 and an annual expense ratio of 0.35%, which is below the category average of 0.50%. The fund carries a 3-year beta of 0.06.
Thrivent Limited Maturity Bond Fund Class S (THLIX - Free Report) invests a huge part of its assets in debt securities or preferred stocks that are rated "BBB" or higher by the S&P or rated "Baa" or more by Moody’s. THLIX seeks growth of income together with the stability of principal.
This Sector - Inv Grade Bond-Short product has a history of positive total returns for over 10 years. Specifically, the fund has returned 1.7% over the three-year and 1.7 over the five-year benchmarks. To see how this fund performed compared to its category, and other #1 and 2 Ranked Mutual Funds, please click here.
THLIXcarries a Zacks Mutual Fund Rank #2 and an annual expense ratio of 0.42%, which is below the category average of 0.74%. The fund carries a 3-year beta of 0.21.
Dodge & Cox Income (DODIX - Free Report) seeks to maintain a diversified portfolio by investing a large chunk of its assets in investment-grade debt securities and cash equivalents. The fund targets those debt securities for investment, which are rated BBB- or higher by Fitch Ratings or Standard & Poor's Ratings Group, or Baa3 or better by Moody's Investors Service.
This Sector - Inv Grade Bond-Short product has a history of positive total returns for over 10 years. Specifically, the fund has returned 2.7% over the three-year and 3.1% over the five-year benchmarks. To see how this fund performed compared to its category, and other #1 and 2 Ranked Mutual Funds, please click here.
DODIXhas a Zacks Rank #2 and an annual expense ratio of 0.43%, which is below the category average of 0.76%. The fund carries a 3-year beta of 0.67.
PIA Short Term Securities Advisor (PIASX - Free Report) invests a bulk of its assets in securities that have a duration of three years or lower. The fund generally invests in those securities that are rated Baa3 and/or BBB- or higher by a Nationally Recognized Statistical Rating Organization.
This Sector - Inv Grade Bond-Short product has a history of positive total returns for over 10 years. Specifically, the fund has returned 0.8% each over the three-year and five-year benchmarks. To see how this fund performed compared to its category, and other #1 and 2 Ranked Mutual Funds, please click here.
PIASXhas a Zacks Mutual Fund Rank #2 and an annual expense ratio of 0.39%, which is below the category average of 0.50%. The fund carries a 3-year beta of 0.12.
Want key mutual fund info delivered straight to your inbox?
Zacks’ free Fund Newsletter will brief you on top news and analysis, as well as top-performing mutual funds, each week. Get it free >>