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Mutual Fund Commentary

The international bond market has come to represent a particularly lucrative opportunity for investors. Though the U.S. bond market continues to attract investors, it has featured infrequently among the best performing international markets. Today international markets represent more than half of the world’s fixed income investment opportunities. Further, the presence of foreign fixed income securities in a portfolio can also provide a hedge against currency fluctuations. With their widely diversified holdings, mutual funds offer a secure route to investing in the international bond market.

Below we will share with you 5 top rated international bond mutual 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 international bond funds, investors can click here to see the complete list of funds.

Franklin Templeton Emerging Market Debt Opportunities (FEMDX - MF report) aims to provide high total return by investing in emerging markets debt instruments. It predominantly focuses on non-investment grade debt securities. The international bond mutual fund is non-diversified and has returned 15.28% in the last one year period.

The Fund Manager is William Ledward and he has managed this international bond mutual fund since 2006.

Goldman Sachs Emerging Market Debt A (GSDAX - MF report) predominantly invests in emerging market debt securities irrespective of their credit rating. These instruments may be issued by governments as well as corporate entities. The international bond mutual fund is non-diversified and has returned 15.12% in the last one year period.

The international bond mutual fund has a minimum initial investment of $1,000 and an expense ratio of 1.22% compared to a category average of 1.25%.

GMO Emerging Country Debt IV (GMDFX - MF report) seeks to outperform the benchmark J.P. Morgan Emerging Markets Bond Index Global. The fund predominantly invests in sovereign debt instruments of developing markets but it can also invest in firms related to the emerging countries. The international bond mutual fund returned 21.98% in the last one year period.

As of November 2012, this international bond mutual fund held 159 issues, with 5.38% of its total assets invested in Bolivarian Republic Venezuela 11.95%.

MainStay Global High Income A (MGHAX - MF report) invests in securities of issuers located in at least three foreign nations. It predominantly invests in securities rated below investment grade in order to generate high income levels. The international bond mutual fund is non-diversified and has returned 16.57% in the last one year period.

The Fund Manager is Dan Roberts and he has managed this international bond mutual fund since 2011.

Fidelity New Markets Income (FNMIX - MF report) seeks high current income. The fund invests the majority of its assets in emerging market securities and other investments related to such markets. It predominantly invests in debt instruments but may also purchase other kinds of securities. The international bond mutual fund is non-diversified and has returned 16.77% in the last one year period.

The international bond mutual fund has a minimum initial investment of $2,500 and an expense ratio of 0.84% compared to a category average of 1.25%.

To view the Zacks Rank and past performance of all international 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.

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