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Top 10 Best Balanced Mutual Funds part 1

Updated on March 15, 2011
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Intro

Balanced funds or diversified funds are very popular among long term or short term investors. It is even popular for buy and hold investor or retired people. Balanced funds are also known as hybrid funds. These types of funds can invest its asset in fixed income securities or bonds, preferred stocks or convertible stocks, and stock or equity. The asset allocation can vary from one fund to the other funds depending upon its investment style. There are several investment styles for these balanced funds such as conservative allocation, moderate allocation, aggressive allocation, and world allocation.

Note: this list include domestic balanced funds and foreign balanced funds

One of the advantage in investing in this balanced funds are the fund can manage downturns in stock market without too much of a loss. The following is the top 10 best balanced funds:

  1. American Funds Capital Income Builder
  2. American Funds Income Fund of America
  3. Franklin Income A
  4. Vanguard Wellington
  5. American Funds American Balanced
  6. BlackRock Global Allocation
  7. First Eagle Global A
  8. Ivy Asset Strategy A
  9. Fidelity Balanced
  10. Fidelity Puritan

Top 10 Best Balanced Funds

(click column header to sort results)
No  
Mutual Funds Description  
Ticker  
Morningstar rating  
Yield  
Expense ratio  
Total Asset (Bil)  
Min. To Invest  
1
American Funds Capital Inc Bldr
CAIBX
3
3.98%
0.66%
76.36
$250
2
American Funds Inc Fund of Amer
AMECX
4
4.09%
0.61%
67.20
$250
3
Franklin Income A
FKINX
3
6.87%
0.65%
55.32
$1,000
4
Vanguard Wellington
VWELX
5
2.93%
0.34%
51.34
$3,000
5
American Funds American Balanced
ABALX
3
2.12%
0.67%
49.34
$250

1. American Funds Capital Income Builder

American Funds Capital Income Builder fund seeks to provide current income and a growing income stream for future. This American Funds normally invests most of its assets (>90%) in income-producing securities, >50% in stock securities. It may invest in foreign bonds and stocks as well. The fund lead manager is James B. Lovelace since 1991. This fund is categorized as world allocation balanced fund. I would consider this fund has moderate allocation with >50% asset in stocks. Investor can invest in this fund with minimum initial of $250. The fund expense ratio is 0.66% per year. There are front end sales charge of 5.75% and 12b1 fee of 0.23%. Investor may find other class with no sales charge fee or 12b1 fee. The fund has returned -0.73% over the past year and 6.51% over the past decade based on load adjusted returns.

As of February 2011, the asset mix is as follows 42.7% of Non-US Equities, 30.6% of US Equities, 18.6% of US Bonds, 3.4% of Non US Bonds, and 4.7% of Cash & Equivalent. The top 5 largest industry holdings include Diversified telecommunication services; Oil, gas & consumable fuels; Tobacco; Pharmaceutical; and Commercial banks. Top 5 largest holdings in this fund include: Stocks & convertible securities (72.4%), US Corporate Bonds (5.9%), Federal Agency Mortgage bonds (5.3%), Cash (5.1%), and US Treasuries (4.1%).Top 10 largest equity holdings include Philip Morris International, AT&T, Royal Dutch Shell, Altria, ConocoPhillips, Novartis, Merck, GDF Suez, America Movil, and Kraft Foods.


2. American Funds Income Fund of America

American Funds Income Fund of Americainvestment seeks current income and capital appreciation. The fund invests primarily in income-producing securities such as dividend paying common stocks, and interest paying bonds. It usually invests >60% of assets in stocks and other equity securities. The fund may in foreign stocks and bonds. The fund lead manager is Abner D. Goldstine since 1973. This fund is categorized as moderate allocation balanced fund. The annual expense ratio of this fund is 0.61%. As typical American Funds Class A fund, there are front end sales charge of 5.75% and 12b1 fee of 0.24%. The fund has returned 3.05% over the past year and 2.48% over the past 5 years based on load adjusted returns. This fund can be purchased through 71 brokerages like E*Trade Financial, TD Ameritrade Inc, Raymond James, US Bancorp Investment, JP Morgan, etc.

As of February 2011, the fund asset mix is as follows 45.8% of US Equities, 24.8% of US Bonds, 19.7% of Non US Equities, 5.1% of Non US Bonds, and 4.6% of Cash. Top 5 largest industry holdings include oil & consumable fuels, pharmaceuticals, diversified telecommunication services, commercial banks, and Real Estate Investment Trusts (REITs). Top 10 largest equity holdings include Verizon, Home Depot, Royal Dutch Shell, Merck, Chevron, Bristol-Myers Squibb, Waste Management, DuPont, Philip Morris International, and GDF Suez. 


3. Franklin Income A

TheFranklin Income fund objective is to maximize income while maintaining prospects for capital appreciation. The fund usually invests in a diversified portfolio of debt and equity securities. It may invest below investment-grade debts, corporate debt, foreign debt, U.S. Treasury bonds, dividend paying stocks, and foreign securities. This Franklin Income fund is part of Franklin Templeton Investment Fund Family. The fund has been managed by Charles B. Johnson since 1957. This fund is categorized as conservative allocation balanced fund. The annual expense ratio of this fund is 0.65%. As typical American Funds Class A fund, there are front end sales charge of 4.25% and 12b1 fee of 0.15%. The fund has returned 7.82% over the past year and 4.46% over the past 5 years based on load adjusted returns. Investor can buy this mutual fund online through 97 brokerages or any discount brokerages. The fund also has a 3 stars rating from Morningstar research team.

As of January 2011, the fund asset mix includes 56% of other investment, 35% of Stocks, and 9% of convertibles. Top 5 sector breakdown is as follows: Corporate Bond, Utilities, Financials, Energy, and Loans. Top 5 bond holdings include Energy Future Holdings Corp, CIT Group Inc, First data Corp, Freescale Semiconductor Inc, and HCA Inc. The Top 5 Equity holdings include Exxon Mobil Corp, Merck & Co, Well Fargo & Co, Roche Holdings AG, and Southern Co.


4. Vanguard Wellington Inv

Vanguard Wellington investment seeks to offer long-term capital appreciation and reasonable current income. The fund invests 60% - 70% of assets in dividend-paying of medium-size and large companies. It invests 30% - 40% of the fund's assets mainly in fixed income securities or bonds. These fixed incomes include investment-grade corporate bonds, U.S. Treasury and government agency bonds, and mortgage-backed securities. Vanguard Wellington is one of the funds with 5 stars rating from Morningstar. The fund expense ratio is only 0.35% per year. You will need $10,000 initial capital to invest in this Vanguard fund. It also has a yield of 2.93% per year. The fund has been managed by Edward P. Bousa since 2002. There is no sales charge or 12b1 fee. The fund is also available in 73 different brokerages include Vanguard Brokerage.

As of February 2012, the fund asset allocation is as follows: 66.90% in stocks, 29.88% in Bonds, and 3.22% in Short term reserves. The fund also holds 471 bond holdings with average duration of 5.4 years. There are 106 stocks in its asset, about 11.4% in foreign stocks. Top 5 equity sector diversification is financials, energy, health care, information technology, and Industrials. The top 10 largest equity holdings include Exxon Mobil Corp, AT&T Inc, International Business Machines Corp, Wells Fargo & Co, Chevron Corp, Pfizer Inc, JPMorgan Chase & Co, Merck & Co Inc, Eli Lily & Co, and Metlife Inc.


5. American Funds American Balanced Fund

American Funds American Balanced fund objective to provide capital conservation, current income and long-term growth of capital and income. The fund invests in a broad range of securities, including stocks, bonds and securities issued and guaranteed by the U.S. government. It may invest >50% of assets in stocks or equities and > 25% of assets in debt securities, including money market securities. The fund lead manager is Robert G. O'Donnell since 1986. This fund is categorized as moderate allocation balanced fund. The annual expense ratio of this fund is 0.67%. As typical American Funds Class A fund, there are front end sales charge of 5.75% and 12b1 fee of 0.24%. The fund has returned 2.38% over the past year and 4.92% over the past decade based on load adjusted returns. This fund can be purchased through 71 brokerages or any discount brokerage.

As of February 2011, the fund asset mix is as follows 61.6% of US Equities, 26.4% of US Bonds, 5.0% of Non US Equities, 2.7% of Non US Bonds, and 4.3% of Cash. Top 5 largest industry holdings include oil & consumable fuels, Chemicals, pharmaceuticals, commercial banks, and Aerospace & defense. Top 10 largest equity holdings include Chevron, Wells Fargo & Co, Philip Morris International, Home Depot, Goldman Sachs, Royal Dutch Shell, Microsoft, Berkshire Hathaway, Oracle, and American Express.

More on my next article: Top 10 Best Balanced Mutual Funds Part 2


Disclosure: I have no affiliation with any of these funds. I also have no position in these funds. Please do your own research for additional details. Please trade and invest responsibly. Past Performance is No Guarantee of Future Results.


Top 10 best balanced funds performance

(click column header to sort results)
No  
Mutual Funds Description  
Ticker  
1 Yr  
3 Yr  
5 Yr  
10 Yr  
1
American Funds Cap Inc Bld
CAIBX
-0.73%
-6.29%
2.67%
6.51%
2
American Funds Inc Fund of Amer
AMECX
3.05%
-3.92%
2.48%
5.77%
3
Franklin Income A
FKINX
7.82%
-0.82%
4.46%
6.82%
4
Vanguard Wellington
VWELX
6.43%
0.05%
4.81%
6.15%
5
American Funds American Balanced
ABALX
2.38%
-3.06%
1.83%
4.92%
6
BlackRock Global Allocation Inv
MDLOX
7.70%
1.06%
5.61%
7.90%
7
First Eagle Global A
SGENX
13.95%
4.05%
6.52%
12.21%
8
Ivy Asset Strategy A
WASAX
5.88%
-1.06
7.79%
8.58%
9
Fidelity Balanced
FBALX
17.87%
2.12%
3.50%
5.86%
10
Fidelity Puritan
FPURX
18.17%
2.95%
4.40%
4.79%
Updated on: 2/22/2011

Comments

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    • monicamelendez profile image

      monicamelendez 

      6 years ago from Salt Lake City

      I would definitely like to hear more about mutual funds!

    • chan0512 profile imageAUTHOR

      chan0512 

      7 years ago from Camarillo, CA

      Thanks! More to come on mutual funds. This balanced fund is suitable for asset diversification.

    • crystolite profile image

      Emma 

      7 years ago from Houston TX

      this article has bring my memory back to Mutual funds. Thank you very much

    • chan0512 profile imageAUTHOR

      chan0512 

      7 years ago from Camarillo, CA

      iamageniuster,

      Thanks for stopping by.. more to come for balanced funds, please check my next article. Thanks again.

    • iamageniuster profile image

      iamageniuster 

      7 years ago

      There's a lot of good info in this article. Thanks for sharing. I was trying to decide which funds to buy.

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