Top Diversified Bond Funds

Featuring top performing 'Diversified Bond" fixed-income mutual funds, because they protect investors by diversifying across sectors. This approach ensures that any negative fluctuation in a sector only has a slight overall effect on the fund ' and its investors, since various sectors of the bond market react differently to changes in the economy and interest rates.These funds thus pursue total return as well as income by investing in a variety of bonds, including corporate, U.S. government, government agency and mortgage-backed bonds.

Investors can find such diversified bond funds by viewing the entire list of the Zacks #1 Rank Diversified Bond Fixed-Income Funds.

5 Great Examples of Diversified Bond Funds

Delaware Diversified Income A (DPDFX) seeks maximum long-term total return. It was incepted in December 1997.

This diversified bond fund mainly invests in three sectors of the fixed-income securities markets, the U.S. Investment Grade Sector, the U.S. High-Yield Sector, and the International Sector. This diversified bond fund invests a majority of its assets, at least 80%, of its net assets in fixed income securities.

The diversified bond fund has an expense ratio of 0.99% against a category average of 0.96%. As of July 2009, it has a portfolio turnover of 422% against a category average of 226%.

Paul Grillo has been lead manager of the fund since February 2001. Grillo joined Delaware in 1992 and is a member of the firm's taxable fixed income portfolio management team and asset allocation committee.

MainStay Diversified Income A (MASAX) seeks total return and current income by investing both in domestic and foreign debt securities. It was incepted in February 1997.

This diversified bond concentrates on U.S. government and domestic investment grade securities, high-yield corporate bonds and international debt securities and wishes to combine high quality, higher return potential and broad diversification by country, currency, industry and type of security. The diversified bond undertakes economic and market monitoring, fundamental research and relative-value analysis in order to identify promising countries, bond market sectors and securities.

Shareholders have to make a minimum initial investment of $25,000 to enter this Zacks #1 Rank ("Strong Buy") fund. This precious metals fund has an expense ratio of 1.30% against a category average of 1.15%.

Dan Roberts has been lead manager of this diversified bond fund since October 2009. Before joining his current assignment in 2004, Roberts was the chief investment officer at Pareto Partners.

Pioneer Strategic Income A (PSRAX) seeks a high level of current income It was incepted in April 1999.

The diversified bond fund invests at least 80% of its assets in a broad range of both issuers and segments of the debt securities markets. The diversified bond fund invests in three segments of the debt markets - below investment grade (high yield) securities of U.S. and non-U.S. issuers, investment grade securities of U.S. issuers and investment grade securities of non-U.S. issuers. The proportion of assets allocated among these segments depends upon the fund advisor's outlook for economic, interest rate and political trends.

The diversified bond fund offers dividends on the last business day of each month. Capital gains are distributed in November. As of September 2009, it has a portfolio turnover of 32% against a category average of 104%.

Kenneth J. Taubes has been lead manager of the fund since April 1999. Taubes has been an investment professional since 1982 and joined Pioneer as a senior vice president in 1998.

Nuveen Multi-Strategy Income A (NCBAX) seeks the highest possible level of current interest income which is exempt from federal income tax and California state individual income tax. It was incepted in April 2006.

This diversified bond fund invests in investment grade, long-term municipal securities. It may invest up to 35% of assets in debt of non-U.S. bond issuers. It may also invest up to 20% of net assets in high yield debt securities and up to 10% in foreign entities that are located in emerging markets.

Shareholders have to make a minimum initial investment of $3,000 to enter this Zacks #1 Rank ("Strong Buy") fund. It has an expense ratio of 0.75 % against a category average of 0.96%.

Andrew John Stenwall has been lead manager of this diversified bond fund since December 2004. Since 2008, Stenwall is an employee of both Rittenhouse and Nuveen Asset Management and specializes in global fixed-income and currency markets.

Virtus Multi-Sector Fixed Income A (NAMFX) was incepted in December 1989. The diversified bond fund aims at maximizing current income while preserving capital.

This diversified bond fund invests in all sectors of the bond market, concentrating on undervalued sectors and securing gains from overvalued sectors. At least 80% of the funds assets are invested in fixed income securities issued or guaranteed by the U.S. Government or its agencies, in debt securities issued by foreign issuers and in junk bonds.

Shareholders have to make a minimum initial investment of $500 to enter this Zacks #1 Rank ("Strong Buy") fund. As of July 2009, it has a portfolio turnover of 91% against a category average of 104%.

David L. Albrycht has been lead manager of the fund since March 1994. Albrycht is a Chartered Financial Analyst and is a senior managing director with Phoenix Investment Counsel.

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