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Top 3 Convertible Funds
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ShareInvestors looking for a steady flow of income as well as protection from the market fluctuations would do well to consider convertible securities. In the recent past, such instruments have generated better returns than broad equity market indices during periods of market volatility. In addition, they also provide an income stream from equity categories, which do not usually offer the same, such as technology. However, the cost involved in putting together a portfolio of these securities may be prohibitive. With their low minimum investment requirements, mutual funds offer an excellent option to benefit from convertible securities.
Below we will share with you 3 top rated convertible 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 convertible funds, then click here.
Franklin Convertible Securities A (FISCX) seeks total return and aims to keep the risk involved within reasonable limits. It invests at least 80% of its assets in convertible securities. Not more than 10% of its assets are invested in securities rated below B or unrated securities of similar quality. The fund returned 46.14% over the last one year period.
The convertible fund has a minimum initial investment of $1000 and an expense ratio of 0.90% compared to a category average of 1.44%.
Calamos Convertible A (CCVIX) invests the majority of its assets in domestic and foreign convertible securities. The fund purchases securities with an average maturity period ranging form two to ten years. It seeks current income with capital appreciation as a secondary objective. The fund returned 30.59% over the last one year period and has a ten year annualized return of 4.93%.
The fund manager is John P. Calamos, Sr. and he has managed this convertible fund since 1985.
Putnam Convertible Income-Growth A (PCONX) seeks capital protection and growth as well as current income. At least 80% of its assets are invested in convertible securities, a sizeable portion of which are rated below investment grade. It invests heavily in large and mid-cap companies. The convertible securities purchased by the fund are generally those with a maturity period of three years or more. The convertible fund returned 49.06% over the last one year period.
As of December 2009, this convertible fund held 22 issues, with 1.82% of its total assets invested in Freeport-Mcmoran Copper & Gold Convertible Bond.
To view the Zacks Rank and past performance of all convertible funds, then click here.
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/mutualfund/
Read the full analyst report on FISCX
Read the full analyst report on CCVIX
Read the full analyst report on PCONX
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| Market Summary | May 26, 2012 07:27 am ET |
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