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 portfolios with 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. Meanwhile, intermediate-term funds usually provide a safer option for investors, when compared to small-term funds. Fixed income securities having average maturity period between 3 and 10 years are classified as intermediate securities. These funds are believed to assure more stability and provide higher return than what short-term funds offer.
Below we will share with you 3 highly rated government intermediate bond mutual funds. Each has earned either a Zacks #1 Rank (Strong Buy) or a Zacks #2 Rank (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 intermediate bond funds, investors can click here to see the complete list of funds.
JPMorgan Government Bond A (OGGAX - Free Report) seeks to provide high current income. OGGAX primarily invests in securities that are approved by the U.S. government or by its affiliates. OGGAX focuses on acquiring government bonds having intermediate or long term maturity. OGGAX has an average maturity of 3 to 15 years. The JPMorgan Government Bond A fund has returned 3% over the past one year.
As of March 2015, OGGAX held 326 issues with 5.23% of its assets invested in U S Treas Sec Stripped Int Pmt.
Fidelity Government Income (FGOVX - Free Report) invests a lion’s share of its assets in securities and instruments of the U.S government. FGOVX invests in securities that are affiliated by agencies which are sponsored by Congress but are not guaranteed by the U.S. Treasury. FGOVX invests its assets across a wide range of market sectors. The Fidelity Government Income fund has returned 2.7% over the past one year.
FGOVX has an expense ratio of 0.45% as compared to category average of 0.92%.
Performance Trust Strategic Bond (PTIAX - Free Report) seeks to achieve interest income and capital growth by investing a major portion of its assets in fixed-income securities that are believed to be undervalued. These securities include bonds and debt securities that are issued by U.S. government or private-sector agencies. PTIAX may also invest a significant share of its assets in derivatives including futures contracts, options and swaps in order to reduce risk exposure. The Performance Trust Strategic Bond fund has returned 4.3% over the past one year.
Anthony J. Harris is one of the fund managers and has managed PTIAX since 2010.
To view the Zacks Rank and past performance of all government intermediate 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. Pick the best mutual funds with the Zacks Rank.