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4 Best High-Yield Bond Mutual Funds for Your Portfolio
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Mutual funds that seek to provide impressive returns by investing in below investment-grade bonds, also known as junk bonds, are generally known as high yield bond mutual funds. These funds are expected to provide higher returns than those investing in investment-grade securities. Moreover, the high yield feature of junk bonds makes them less vulnerable to interest rate fluctuations. Though junk bonds are considered riskier than investment-grade debt securities, mutual funds maintaining a well-diversified portfolio of such securities may reduce the level of risk.
AllianzGI High Yield Bond A seeks growth in capital and current income. A large share of its assets is invested in high yield debt securities like junk bonds. AYBAX also invests in a wide range of fixed income securities below investment grade rated or unrated. AllianzGI High Yield Bond A returned 13.2% over the last one-year period.
As of January 2017, this high yield mutual fund held 172 issues, with 1.58% of its total assets invested in Reorganized 16-10238 Holdco Pfd.
MassMutual Premier High Yield Service (DLHYX - Free Report) invests the lion’s share of its assets in high-yielding, fixed-income producing securities that are unrated or rated below investment grade. DLHYX invests in securities that are rated below BBB- by Standard & Poor's or Baa3 by Moody's, respectively. MassMutual Premier High Yield Service returned 15.5% over the last one-year period.
DLHYX has an expense ratio of 0.75% compared with the category average of 1.07%.
Waddell & Reed High-Income Y seeks appreciation of income and capital. WYHIX focuses on investing in a well-diversified portfolio, which includes fixed-income securities. These securities are rated below investment grade and offer a high yield. Waddell & Reed High-Income Y returned 16.2% over the last one-year period.
Chad Gunther is the fund manager of WYHIX since 2014.
Lord Abbett High Yield F (LHYFX - Free Report) invests the lion’s share of its assets in low-rated debt securities, including corporate bonds that can be converted into common stocks. LHYFX may invest around one-fifth of its assets in securities of foreign companies. The fund may also invest nearly 20% of its assets in muni bonds. Lord Abbett High Yield F returned 16.1% over the last one-year period.
LHYFX has an expense ratio of 0.81% compared with the category average of 1.07%.
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4 Best High-Yield Bond Mutual Funds for Your Portfolio
Mutual funds that seek to provide impressive returns by investing in below investment-grade bonds, also known as junk bonds, are generally known as high yield bond mutual funds. These funds are expected to provide higher returns than those investing in investment-grade securities. Moreover, the high yield feature of junk bonds makes them less vulnerable to interest rate fluctuations. Though junk bonds are considered riskier than investment-grade debt securities, mutual funds maintaining a well-diversified portfolio of such securities may reduce the level of risk.
Below we share with you four top-ranked high-yield bond mutual funds. Each has earned a Zacks Mutual Fund Rank #1 (Strong Buy) and is expected to outperform its peers in the future. Investors can click here to see the complete list of high-yield bond mutual fundsto view their Zacks Rank and past performance.
AllianzGI High Yield Bond A seeks growth in capital and current income. A large share of its assets is invested in high yield debt securities like junk bonds. AYBAX also invests in a wide range of fixed income securities below investment grade rated or unrated. AllianzGI High Yield Bond A returned 13.2% over the last one-year period.
As of January 2017, this high yield mutual fund held 172 issues, with 1.58% of its total assets invested in Reorganized 16-10238 Holdco Pfd.
MassMutual Premier High Yield Service (DLHYX - Free Report) invests the lion’s share of its assets in high-yielding, fixed-income producing securities that are unrated or rated below investment grade. DLHYX invests in securities that are rated below BBB- by Standard & Poor's or Baa3 by Moody's, respectively. MassMutual Premier High Yield Service returned 15.5% over the last one-year period.
DLHYX has an expense ratio of 0.75% compared with the category average of 1.07%.
Waddell & Reed High-Income Y seeks appreciation of income and capital. WYHIX focuses on investing in a well-diversified portfolio, which includes fixed-income securities. These securities are rated below investment grade and offer a high yield. Waddell & Reed High-Income Y returned 16.2% over the last one-year period.
Chad Gunther is the fund manager of WYHIX since 2014.
Lord Abbett High Yield F (LHYFX - Free Report) invests the lion’s share of its assets in low-rated debt securities, including corporate bonds that can be converted into common stocks. LHYFX may invest around one-fifth of its assets in securities of foreign companies. The fund may also invest nearly 20% of its assets in muni bonds. Lord Abbett High Yield F returned 16.1% over the last one-year period.
LHYFX has an expense ratio of 0.81% compared with the category average of 1.07%.
To view the Zacks Rank and past performance of all municipal bond funds, investors can click here to see the complete list of funds.
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