Mutual funds investing in debt securities are among the most secure investment options which provide regular income while protecting capital invested. Funds which are part of this category bring a great deal of stability to portfolio which a large proportion of equity, while providing dividends more frequently than individual bonds. U.S government bonds 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.
Lord Abbett Income A (LAGVX - MF report) (LAGVX - MF report) seeks high return along with capital preservation. A minimum of 65% of its assets is invested in debt securities backed by the U.S. Government. Investments are also made in derivatives. The government bond mutual returned 10.37% over the last one year period.
The government bond mutual fund has an expense ratio of 0.80% compared to a category average of 0.89%.
Hussman Strategic Total Return (HSTRX - MF report) invests mainly in fixed-income securities. A maximum of 30% will be invested in Treasury interest Strips and zero-coupon bonds. The maturity period of its portfolio is usually between 1 year and 15 years. The government bond mutual fund returned -3.84% over the last one year period.
As of March 2013, this government bond mutual fund held 38 issues, with 14.62% of its total assets invested in U.S. Treasury Notes 1.625%
Wasatch-Hoisington US Treasury (WHOSX - MF report) seeks returns which is higher than the inflation rate over a business cycle. A minimum of 90% of its assets is invested in U.S. Treasury securities or repurchase agreements backed by those securities. The government bond mutual fund returned 7.08% over the last one year period.
The Fund Manager is Van Robert Hoisington and he has managed this government bond fund since 1996.
JHancock Investment Grade Bond A (TAUSX - MF report) invests the majority of its assets in investment grade bonds. The fund has a dollar weighted average maturity period between 3 and 10 years. Investments are also made in derivatives and mortgage-related securities. The government bond mutual fund returned 6.68% over the last one year period.
The government bond mutual fund has an expense ratio of 0.98% compared to a category average of 0.89%.
Western Asset Mortgage Backed Securities A (SGVAX - MF report) seeks high return. The fund invests a large share of its assets in mortgage-backed securities issued by government backed institutions such as Federal National Mortgage Association (Fannie Mae), the Federal Home Loan Mortgage Corporation (Freddie Mac). The government bond mutual fund returned 7.16% over the last one year period.
The Fund Manager is Stephen Walsh and he has managed this government bond fund since 2006.
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 https://www.zacks.com/funds.