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Highest Yielding Zacks #1 Ranked Funds

Government bond mutual funds are considered to be the safest class of investments in the bond fund category. These funds generally hold a portfolio of securities issued by the US Treasury and other government agencies which are backed by the full faith and credit of the US government. Yields from these instruments are typically low but the associated risk is also much smaller. In addition, many of these instruments are exempt from state and local taxes. By holding widely diversified portfolios of these investments, mutual funds contribute significantly to the safety associated with them.

Below we will share with you the 5 highest yielding Zacks #1 ranked 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, investors can click here to see the complete list of funds.

Mutual Fund

Sec 30 Day Yield

Fidelity Spartan Long-Term Treasury Bond Index

3.27%

Fidelity Spartan Intermediate Treasury Bond Index

2.64%

Dreyfus US Treasury Long-Term

2.37%

Vanguard Long-Term Treasury Investor

2.28%

T. Rowe Price US Treasury Long-Term

2.27%

 
Fidelity Spartan Long-Term Treasury Bond Index (FLBIX - MF report) invests a large share of its assets in securities which are part of the Barclays Capital U.S. Long Treasury Bond index. The dollar-weighted average maturity period of the portfolio is at least 10 years or more. The government bond mutual fund returned 31.65% over the last one year period.

The Fund Manager is Curt Hollingsworth and he has managed this government bond fund since 2009.

Fidelity Spartan Intermediate Treasury Bond Index (FIBAX - MF report) seeks high current income. The fund utilizes the majority of its assets to purchase securities which are part of the Barclays Capital U.S. 5-10 Year Treasury Bond Index. The government bond mutual fund returned 11.88% over the last one year period.

As of April 2012, this government bond mutual fund held 57 issues, with 4.85% of its total assets invested in US Treasury Note 3.625%.

Dreyfus US Treasury Long-Term (DRGBX - MF report) invests a substantially high proportion of its assets in securities issued or guaranteed by the U.S. government or its agencies. The government bond mutual fund returned 30.94% over the last one year period.

The government bond mutual fund has a minimum initial investment of $2,500 and an expense ratio of 0.65% compared to a category average of 0.84%.

Vanguard Long-Term Treasury Investor (VUSTX - MF report) seeks high and sustainable current income. The fund utilizes a large share of its assets to purchase securities issued by the U.S. Treasury, including bills, bond and notes.. The government bond mutual fund returned 31.62% over the last one year period.

The Fund Manager is David R. Glocke and he has managed this government bond fund since 2001.

T. Rowe Price US Treasury Long-Term (PRULX - MF report) invests at least 85% of its assets in U.S Treasury securities. The balances of its funds are used to purchase other securities backed by the credit of the U.S. government. The government bond mutual fund returned 31.43% over the last one year period.

The government bond mutual fund has a minimum initial investment of $2,500 and an expense ratio of 0.55% compared to a category average of 0.84%.

To view the Zacks Rank and past performance of all government bond mutual funds, investors can click here to see the complete list of funds.

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.

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