Top 5 Balanced Mutual Funds - Best of Funds

Investors seeking to combine the benefits of both stocks and bonds would do well to consider balanced funds which invest in a diversified portfolio of both equity and debt instruments. These funds provide both income and capital appreciation at an appreciably lower level of risk. The better managed balanced funds keep the proportion of assets invested in different asset classes flexible and make changes according to market conditions. This enables balanced funds to make the most of market upswings while protecting capital during a downturn.

Below we will share with you 5 top rated balanced 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 balanced funds, then click here.

J Hancock Balanced A (SVBAX) seeks current income and capital appreciation over the long term. It invests in a wide range of equity and debt securities. At least 25% of its assets are invested in equity securities and not more than 25% is used to purchase senior debt securities. The balanced mutual fund has a five year annualized return of 7.43%.

The balanced mutual fund has a minimum initial investment of $2,500 and an expense ratio of 1.17% compared to a category average of 1.01%.

Wells Fargo Advantage WealthBuilder Growth Balanced (WBGBX) invests 62% of its assets in equity funds, 33% in bond funds and only 10% in alternative strategy funds. These underlying funds may be both affiliated and non-affiliated. The balanced mutual fund returned 15.19% over the last one year period.

The fund manager is Jeffrey Mellas and he has managed this balanced mutual fund since 2003.

Value Line Income & Growth (VALIX) seeks income with capital appreciation as a secondary objective. Not less than 50% of its assets are used to purchase common or preferred stock. Up to 50% of its assets are invested in government securities, investment grade debt and money market securities. This balanced mutual fund has a three year annualized return of 5.08%.

The balanced mutual fund has a minimum initial investment of $1,000 and an expense ratio of 1.05% compared to a category average of 1.01%.

Ivy Balanced A (IBNAX) invests in a diversified portfolio of equity, debt and short term instruments, the composition of which depends on current market conditions. The fund focuses on investing in large and mid-cap companies which pay regular dividends. The balanced mutual fund has a ten year annualized return of 6.06%.

As of March 2011, this balanced mutual fund held 131 issues, with 2.95% of its total assets invested in Toyota Motor Credit Corp.

Virtus Balanced A (PHBLX) seeks to provide reasonable income and capital growth over the long term. At least 65% of its assets are utilized to purchase domestic and foreign common stocks and fixed income securities. This balanced mutual fund returned 13.59% over the last one year period.

Robert E. Bishop is the fund manager and has managed this balanced fund since 2009.

To view the Zacks Rank and past performance of all balanced mutual funds, then click here.

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 http://www.zacks.com/funds/mutualfund/