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Top 5 Government Bond Mutual Funds

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By: Zacks Investment Research
May 04, 2011 | Comment(s): 0
Recommended this article (6)

Mutual funds investing in debt securities are among the most secure investment options which provide regular income while protecting capital invested. Funds from this category bring a great deal of stability to portfolio with a large proportion of equity, while providing dividends more frequently than individual bonds. U.S government bond mutual funds usually invest in Treasury bills, notes and securities issued by government agencies. They are considered to be the safest in the bond fund category and are ideal options for the risk-averse investor.

Below we will share with you 5 top rated government 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 government bond funds, then click here.

Legg Mason Western Asset Government Securities A (SGVAX) seeks current return. The fund invests the majority of its assets in securities issued by the U.S. government and its agencies. U.S. Treasury securities and debt securities issued by federal agencies are some of the categories the fund invests in. The government bond mutual fund has a three year annualized return of 6.53%.

The Fund Manager is Stephen A. Walsh and he has managed this government bond mutual fund since 2006.

GMO Inflation Indexed Plus Bond III (GMITX) invests heavily in inflation-protected securities and related investments. The fund aims to provide total return greater than the Barclays Capital U.S. Treasury Inflation Notes index. The government bond mutual fund returned 13.37% over the last one year period.

The government bond mutual fund has an expense ratio of 0.38% compared to a category average of 0.85%.

Transamerica Partners IPS (DVIGX) seeks real return. The fund invests the majority of its assets in inflation-protected securities and related investments. The fund utilizes an underlying mutual fund to purchase these securities which are instruments issued by the U.S. government and its agencies. The government bond mutual fund has a ten year annualized return of 3.99%.

The Fund Manager is Martin Hegarty and he has managed this government bond mutual fund since 2010.

T. Rowe Price Inflation Protected Bond (PRIPX) invests a large proportion of its assets in inflation-protected bonds. The fund focuses on purchasing bonds issued by the US Treasury, but similar instruments issued by US government agencies and corporations may also be acquired. The government bond mutual fund returned 7.42% over the last one year period.

As of March 2011, this government bond mutual fund held 41 issues, with 10.34% of its total assets invested in US Treasury Note 2%.

Delaware Inflation Protected Bond A (DIPAX) seeks to provide current income and protection against inflation. The fund primarily invests in inflation-indexed bonds issued by the US government, its agencies as well as corporations. The government bond mutual fund has a five year annualized return of 6.19%.

The government bond mutual fund has a minimum initial investment of $1,000 and an expense ratio of 0.78% compared to a category average of 0.84%.

To view the Zacks Rank and past performance of all government bond mutual funds, then click here.

About Zacks Mutual Fund Rank

By applying the Zacks Rank to mutual funds, investors can find top 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 

Read the full analyst report on SGVAX

Read the full analyst report on GMITX

Read the full analyst report on DVIGX

Read the full analyst report on PRIPX

Read the full analyst report on DIPAX

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