Top 5 Highest Yielding International Bond Mutual Funds - Highest Yielding Zacks #1 Ranked Funds

Investing in international bond funds is one of the best ways to balance losses incurred in US markets, since interest rate fluctuations differ from country to country. This is because such securities show little correlation with domestic equities and only moderate correlation with investment grade domestic debt. They also help in diversifying currency exposure and protecting assets against a long-term secular decline in the U.S. dollar. With their widely diversified holdings, mutual funds offer a secure route to investing in the international bond market.

Below we will share with you the 5 highest yielding Zacks #1 ranked international 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 international bond funds, then click here.

Mutual Fund	SEC Yield
Invesco International Total Return A	6.28%
Federated International High Income A	6.28%
Columbia Emerging Markets Bond A	4.7%
PIMCO Emerging Local Bond	4.41%
Goldman Sachs Local Emerging Markets Debt A	3.94%

Invesco International Total Return A (AUBAX) invests heavily in a wide range of foreign government and corporate debt instruments as well as in foreign currency. The fund may utilize derivatives to manage risk or enhance return. Not more than 30% of its assets may be utilized to purchase dollar-denominated securities. The international bond mutual fund returned 15.52% in the last one year period.

The international bond mutual fund has a minimum initial investment of $1,000 and an expense ratio of 1.10% compared to a category average of 1.13%.

Federated International High Income A (IHIAX) seeks current income. The fund invests in emerging market debt securities with different maturity periods. It may purchase a significant amount of securities rated below investment grade and invest in derivatives. The international bond mutual fund has a five year annualized return of 10.12%.

The Fund Manager is Roberto Sanchez-Dahl and he has managed this international bond mutual fund since 2001.

Columbia Emerging Markets Bond A (REBAX) invests the majority of its assets in emerging market securities with generate fixed income. The fund may also consider for investment companies which derive a significant portion of their revenues from emerging markets. The international bond mutual fund has a three year annualized return of 12.73%.

As of May 2011, this international bond mutual fund held 109 issues, with 5.13% of its total assets invested in Columbia Short-Term Cash.

PIMCO Emerging Local Bond (PEBLX) seeks total return. The fund invests a large proportion of its assets in fixed-income securities denominated in currencies of emerging markets. The fund may also invest in options, futures and swap instruments. It may also invest in securities with economic linkages to emerging market countries. The international bond mutual fund returned 17.08% in the last one year period.

The international bond mutual fund has an expense ratio of 1.15% compared to a category average of 1.30%.

Goldman Sachs Local Emerging Markets Debt A (GAMDX) invests a large proportion of its assets in emerging market securities issued by governments or corporations. Not more than 20% of its assets may be utilized to purchase fixed-income securities not issued from emerging markets and currency instruments. The international bond mutual fund returned 17.9% in the last one year period.

The Fund Manager is Samuel Finkelstein and he has managed this international bond mutual fund since 2005.

To view the Zacks Rank and past performance of all international bond 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.

 
Zacks Investment Research