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| Top High Yield Bond funds |
High yield bonds can provide investors a reasonable amount of risk in search of high income levels. This type of bonds mostly represents corporate bonds with low ratings (i.e. non-investment grade or junk rating). Mutual funds are the best option to invest in these instruments. By investing in a well-diversified portfolio of mutual fund, investors may successfully lower the associated risk.
Best Performers
The following list has been compiled by sorting through its performance for the past 5 years. Most of these High Yield Bond funds are also rated among the best in their class. Please check details about its performance, expense ratio, sales load, initial investment requirement, risk, top holdings, etc.
Based on 5 years performance, Top 10 Best High Yield Bond Mutual Funds of 2012 are:
- PIA High Yield Investor (PHYSX)
- Ivy High Income A (WHIAX)
- Neuberger Berman High Inc Bond Inv (NHINX)
- PACE High Yield A (PHIAX)
- TIAA-CREF High-Yield Retail (TIYRX)
- Allianz AGIC High Yield Bond A (AYBAX)
- Metropolitan West High Yield Bond M (MWHYX)
- Touchstone High Yield Y (THYYX)
- Fidelity Capital & Income (FAGIX)
- Fifth Third High Yield Bond A (FTYAX)
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| PIA High Yield Fund Profile |
This PIA High Yield Fund invests in a diversified portfolio of domestic and foreign high yield debt securities. The fund may invest in bonds, forward commitments, loan participiations & assignments, and preferred stocks. The high yield mutual fund has a three year annualized return of 20.64%.
The high yield mutual fund has a minimum initial investment of $1,000 for regular brokerage account and an expense ratio of 0.98% compared to a category average of 1.14%. The top sector of this Pacific Income Advisors fund is corporate bond (90.42%).
2. Ivy High Income A
The investment objective of Ivy High Income fund is to provide total return through capital appreciation and high current income. This fund invests primarily in lower quality bonds or junk bonds. This fund is managed by Bryan C. Krug since 2006. The dividend yield is 7.93%. It also has a sales load of 5.75%
The top holding of this top performer fund is Laureate Education 144A 10.25% bond. Investor can start investing with as little as $500. The average effective duration is 3.64 years.
3. Neuberger Berman High Income Bond Inv
The Neuberger Berman High Income Bond fund seeks high total returns consistent with preservation of capital. The fund expects to maintain a weighted average maturity between 5-10 years. The fund’s managers are Ann H. Benjamin, Thomas P. O’Reilly, and Russ Covode. The fund’s total net assets are $2.43 billion. The expense ratio is 0.86%.
Best Performer Diversified Bond Mutual Funds 2012
This top high yield bond fund has 4 stars rating from Morningstar. It has returned 19.90% over the past 3 year, 8.35% over the past 5 year, and 7.75% over the past decade. This fund is currently limited to new investor.
4. PACE High Yield A
This 3 stars fund invests mainly in a diversified portfolio of fixed income securities rated below investment grade. This best bond fund may use interest rate futures contracts in managing its exposure to changes in interest rates. The PHIAX fund is managed by Louis N. Cohen, Michael Kimble, Dan Roberts, and Taylor Wagenseil.
This PACE High Yield A has a 5 year annualized return of 8%. You can buy this mutual fund from 22 brokerages such as UBS Financial Services Inc, TD Ameritrade, Fidelity Retail FundsNetwork, etc.
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| TIAA-CREF High Yield fund |
The TIAA CREF High Yield fund objective is to provide high current income and capital appreciation. This bond fund uses its assets to buyt the lower-rated, higher-yielding fixed-income securities. The fund invests <20% of assets in payment-in-kind or deferred interest obligations, defaulted securities, asset-backed securities, securities rated lower than B- by rating agencies.
Kevin R. Lorenz and Jean Lin are the fund’s managers. It is rated with 4 stars rating. The fund’s annual turnover rate is 43%. For 2011, this top rated fund has returned 6.72%.
6. Allianz AGIC High Yield Bond A
This Allianz AGIC High Yield Bond A has a dividend yield of 7.37%. It also has a sales load of 5.5%. The expense ratio is 1.05%. Douglas G. Forsyth and William L. Stickney are the portfolio managers. This fund is opened to new investors.
7. Metropolitan West High Yield Bond M
This Metropolitan West High Yield Bond fund seeks to maximize long term total return with capital preservation. Investor can buy this high yield bond fund initially with $5,000. The annual expense ratio fee is 0.80%. There is no sales load.
The distribution rate for the past 12 months is 7.61%. It also has total net assets of $2.12 Billion. The top 3 bonds holdings are Southern Union Co New FRN, NRG Energy 7.625% bond, and Caesars Entertainment Operating Company bond.
8. Touchstone High Yield Y
This THYYX fund invests most of its assets in non-investment grade bonds especially Domestic Corporation. The lead manager is Brendan M. White since 2000. The fund’s yield is 7.70%. For 2011, it has returned 7.02%.
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| Fidelity Capital & Income fund |
This Fidelity Capital & Income fund objective is to seek income and capital growth. The fund’s Morningstar analyst is Silver rating. This best bond fund has ranked well over the long term period. For 2011, it has one of the worst performance among its peers with top 93% ranking (1% is the best). It also has total net assets of $9.3 Billion. This is one of the largest fixed income funds in this top performing funds list.
10. Fifth Third High Yield Bond A
Fifth Third High Yield Bond A has a sales load of 4.75%. It currently pays a dividend yield of 6.71%. This mutual fund is open to new investors. The minimum initial investment is $1,000 for brokerage account and $500 for tax deferred account (such as IRA, ROTH, 403b, etc). The average effective duration of this top bond is 4.45 years and the average effective maturity is 3.62 years.
Disclosure: No Position
Other Top High Yield Bond Funds:
- Top 10 High Yield Bond Mutual Funds 2011: Part 1
- Top Performer High Yield Bond CEFs of May 2011: Pt 1
Fund Performance
| No | Name | Ticker | 1 Year Return % | 3 Year Return % | 5 Year Return % | 10 Year Return % | Expense Ratio |
|---|---|---|---|---|---|---|---|
| 1 | PIA High Yield Investor | PHYSX | 5.30% | 20.64% | 9.45% | 12.26% | 0.98% |
| 2 | Ivy High Income A | WHIAX | 7.02% | 19.89% | 8.60% | 8.44% | 1.08% |
| 3 | Neuberger Berman High Inc Bond Inv | NHINX | 3.13% | 19.90% | 8.35% | 7.75% | 0.96% |
| 4 | PACE High Yield A | PHIAX | 1.77% | 19.54% | 8.00% | - | 1.31% |
| 5 | TIAA-CREF High-Yield Retail | TIYRX | 6.72% | 18.82% | 7.78% | - | 0.59% |
| 6 | Allianz AGIC High Yield Bond A | AYBAX | 4.80% | 18.89% | 7.78% | 8.33% | 0.96% |
| 7 | Metropolitan West High Yield Bond M | MWHYX | 0.36% | 19.65% | 7.72% | - | 0.81% |
| 8 | Touchstone High Yield Y | THYYX | 6.21% | 20.66% | 7.63% | 8.04% | 0.80% |
| 9 | Fidelity Capital & Income | FAGIX | -0.77% | 26.03% | 7.59% | 10.48% | 0.76% |
| 10 | Fifth Third High Yield Bond A | FTYAX | 5.35% | 20.38% | 7.58% | - | 0.99% |
| 11 | SSgA High Yield Bond Instl | SSHYX | 4.22% | 20.66% | 7.56% | 7.84% | 0.76% |
| 12 | RidgeWorth High Income A | SAHIX | 1.30% | 22.67% | 7.52% | 8.56% | 1.01% |
| 13 | Transamerica AEGON High Yield Bond A | IHIYX | 5.21% | 21.91% | 7.50% | 7.44% | 1.15% |
| 14 | Prudential High-Yield A | PBHAX | 5.57% | 19.86% | 7.50% | 8.31% | 0.88% |
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