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. To view the Zacks Rank and past performance of all government bond funds, investors can click here to see the complete list of funds.
Schwab Treasury Inflation Protected Securities (SWRSX - MF report) invests heavily in Treasury Inflation Protected Securities (TIPS). Under extraordinary circumstances it may utilize all its assets to purchase short term high quality instruments as well as in cash and cash equivalents. The government bond mutual fund returned 7.74% over the last one year period.
The government bond mutual fund has an expense ratio of 0.29% compared to a category average of 0.80%.
Direxion Monthly 10 Year Note Bull 2X (DXKLX - MF report) seeks monthly returns which are 2x the returns of the NYSE Current 10-Year U.S. Treasury Index. The fund invests the majority of its assets in domestic government securities that may consist of index and financial securities to create long positions. It may also invest in short term securities with high credit quality. The government bond mutual fund returned 11.24% over the last one year period.
The Fund Manager is Paul Brigandi and he has managed this government bond fund since 2005.
American Century Zero Coupon (BTTTX - MF report) invests heavily in zero-coupon securities, mainly in U.S. Treasury securities and their equivalents. A maximum of 20% of its assets may be invested in AAA-rated zero-coupon U.S. government agency securities. The government bond mutual fund returned 11.24% over the last one year period.
As of September 2012, this government bond mutual fund held 36 issues, with 19.22% of its total assets invested in US Treasury Sec Stripped Int Pmt.
Rydex Government Long Bond 1.2x Strategy (RYGBX - MF report) seeks returns which are 1.2x the returns of long term U.S Treasury Bonds. The fund invests in a variety of derivative instruments and U.S Government securities to achieve its investment objective. The government bond mutual fund returned 12.70% over the last one year period.
The government bond mutual fund has an expense ratio of 0.95% compared to a category average of 0.82%.
Wasatch-Hoisington US Treasury (WHOSX - MF report) invests at least 90% of its assets in U.S Treasury securities and repurchase agreements backed by such instruments. The fund also purchases long term U.S. Treasury Bonds. The government bond mutual fund returned 12.23% over the last one year period.
The Fund Manager is Van Robert Hoisington and he has managed this government bond fund since 1996.
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 https://www.zacks.com/funds.