Yahoo Finance Top 3 High-Yield Bonds to Gain From Volatile Market Conditions
High-yield bonds behave more like stocks than investment-grade bonds. These bonds have significant holdings in smaller companies, which have a weaker financial condition but benefit as the economy moves north. Though high-yield bonds are more exposed to credit risk, these have less exposure to interest rate risk, making them a differentiated source of returns. Despite headwinds faced in the early months of the pandemic, demand for high yield has recovered since the Fed’s rate cut and reopening of the economy. The improving economic activity renewed the search for yield, and given the current scenario, these bonds are poised to grow.
Below, we share with you three top-ranked high-yield bond mutual funds, namely Intrepid Income Fund Institutional Class ICMUX, Fidelity Capital & Income Fund FAGIX and Buffalo High Yield Fund BUFHX. Each has earned a Zacks Mutual Fund Rank #1 (Strong Buy) and is expected to outperform its peers in the future. Investors can click here to see the complete list of funds.
Intrepid Income Fund Institutional Class invests most of its net assets in fixed-income instruments like high-yield corporate debt securities, bank debt, convertible debt, and U.S. government securities. ICMUX invests in securities for a duration of two to six years at the time of purchase.
Intrepid Income Fund Institutional Classhas three-year annualized returns of 5.1%. As of the end of March 2022, ICMUX has 5.68% of its assets invested in Apollo Comml Real Estate.
Fidelity Capital & Income Fund invests most of its net assets in equity and debt securities of foreign and domestic companies, including lower-quality debt securities of companies in troubled or uncertain financial conditions. FAGIX advisors choose to invest based on a fundamental analysis of each issuer's financial conditions, industry position, and economic factors.
Fidelity Capital & Income Fundhas three-year annualized returns of 4.0%. FAGIX has an expense ratio of 0.68% compared with the category average of 0.95%.
Buffalo High Yield Fund invests most of its net assets in higher-yielding, higher-risk debt securities rated below investment grade by the major rating agencies with intermediate-term maturities. BUFHX also invests a small portion in investment grade debt securities, U.S. Treasury Securities, money market funds, equity investments, dividend-paying stocks, convertible stocks and preferred stocks
Buffalo High Yield Fundhas three-year annualized returns of 2.7%. Paul Dlugosch has been one of the fund manager of BUFHX since July 2007.
To view the Zacks Rank and the past performance of all high-yield bond funds, investors can click here to see the complete list of high-yield bond funds.
Want key mutual fund info delivered straight to your inbox?
Zacks’ free Fund Newsletter will brief you on top news and analysis, as well as top-performing mutual funds, each week. Get it free >>
View All Zacks #1 Ranked Mutual Funds
Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
Get Your Free (FAGIX): Fund Analysis Report
Get Your Free (ICMUX): Fund Analysis Report
Get Your Free (BUFHX): Fund Analysis Report
To read this article on Zacks.com click here.
Zacks Investment Research
