Best Mutual FundsNot all mutual funds make good investments; you need to select the right funds. Based on my research and experience, I believe the following 8 mutual funds are good choice for your 2016 investment. Out of over 22,000 mutual funds that I have searched, I consider these 8 funds to be the best. You may wish to consider these mutual funds as part of a balanced investment portfolio.
You can find different categories of mutual funds such as bond, stock, and balanced fund. I also provide each fund review for your information. Other information such as expense ratio, yield, sector, category, fund performance, fund ranking, top holdings, and bond rating can be found below. All of these best mutual funds are no load mutual funds.
The top 8 mutual funds for 2016 & 2017 are:
- DoubleLine Total Return Bond Fund (DLTNX)
- Vanguard Total Stock Market Index Fund (VTSMX)
- USAA Tax Exempt Intermediate-Term (USATX)
- T. Rowe Price International Discovery Fund (PRIDX)
- DoubleLine Emerging Markets Fixed Income Fund (DLENX)
- Vanguard Emerging Markets Stock Index (VEIEX)
- Fidelity Real Estate Income Fund (FRIFX)
- Vanguard Balanced Index Fund (VBINX)
DoubleLine Total Return Bond Fund (DLTNX)DoubleLine Total Return Bond Fund has been my top funds for the past 5 years. It is managed by famous bond managers, Jeffrey Gundlach and Philip A. Barach. It utilizes its assets to purchase mortgage-backed securities of any maturity or type. Its total nets assets are $47.5 billion. The current yield is 4.04%.
In 2015, this best bond mutual fund has YTD total return of 1.79%. It ranks in the top 3% in its category. Morningstar has ranked it with 5 stars rating. This intermediate term bond fund has no sales load. You can buy this mutual fund with $2,000 initial funding. Its expense ratio is only 0.72%.
As of August 2015, the top 5 sectors in its portfolio are: Agency MBS Pass-Through (29.67%), Agency MBS CMO (22.94%), Non-Agency Residential MBS (19.94%), Asset-Backed (7.69%), and Commercial MBS (6.11%). The current shares price is $11.38.
Vanguard Total Stock Market Index Fund (VTSMX)Vanguard Total Stock Market Index Fund is a 4-star index mutual fund. It uses its assets to purchase US stocks. This large blend mutual fund also has 1.73% dividend yield. The total net assets are $404.3 billion. The current fund’s NAV is $52.41. The Morningstar risk rating is average and the 3 years beta risk is 1.00.
Why should you select this index fund over actively managed fund? This best mutual fund for 2016 has returned 16.63% over the past 3 year, and 7.90% over the past decade. Morningstar ranks this domestic stock fund with 4 stars and gold rating.
The top 3 stocks in its portfolio are Apple Inc, Exxon Mobil Corporation, and Microsoft Corp. The top 3 sectors are technology, healthcare, and financial services. If you invest $10,000 in this fund 10 years ago, your fund has growth to $21,394. This growth represents 213% return over the past 10 years.
USAA Tax Exempt Intermediate-Term Fund (USATX)This USAA Tax Exempt Intermediate-Term fund invests mainly in investment-grade municipal securities which are exempt from federal income tax rate. If your tax is increasing during 2015, this best bond fund may be suitable for you. It provide tax free yield for you. The current yield is 3.32%, this yield is equal to taxable equivalent yield of 5.44% (assuming 39.6% tax rate).
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As one of the top 8 mutual funds for 2016 & 2017, Morningstar has ranked this municipal bond fund with 5 star rating. The fund manager is Regina Shafer. In 2015, the fund’s year to date return is 0.42%. This best muni bond fund has returned 2.92% over the past 3 year, and 4.23% over the past 5 year. Its expense ratio is 0.55%. The portfolio turnover rate is only 4%.
As of August 2015, the top 4 sectors include health (21.71%), industrial (16.44%), transportation (14.20%), and education (14.04%). The average effective maturity is 8.39 years.
T. Rowe Price International Discovery Fund (PRIDX)T. Rowe Price International Discovery Fund is top rated international stock mutual fund. It receives 5 stars and bronze rating from Morningstar. This best mutual fund invests mainly in growing, small- to medium-sized companies outside the U.S. The current share price is $56.62. Its expense ratio is 1.21%. There is no sales load.
More: Best T. Rowe Price Mutual Funds 2015 & 2016
This foreign small/mid growth mutual fund has a 10-year annualized return of 8.89%. For the past 5 year, it ranks in the top fund in its category. Managed by Justin Thomson since 1998, the top 4 stocks in its portfolio include: Victrex PLC, PChome Online Inc, Axiare Patrimonio SOCIMI SA, and Playtech PLC.
DoubleLine Emerging Markets Fixed Income Fund (DLENX)One of the top choices to invest in emerging markets is DoubleLine Emerging Markets Fixed Income Fund. This top fund invests in emerging markets debts including sovereign bonds, corporate bonds, local currency bonds, distressed debt, convertible bonds, and structure finance. This emerging markets debt fund is managed by Luz M. Padilla. Its dividend yield is 4.94%. The minimum initial investment is $2,000 for brokerage account, and $500 for retirement account.
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This no load fund has expense ratio of 1.15%. It has returned -1.16% over the past 1 year. The 5 year annualized return is 5.33%. This top fixed income fund has an average effective duration of 5.05 years, and an average effective maturity of 7.38 years. Its credit quality is rated with BB (i.e. non-investment grade).
Vanguard Emerging Markets Stock Index Fund (VEIEX)Vanguard Emerging Markets Stock Index fund is another great choice to invest in emerging markets. If you have high risk tolerance, you need to invest in this stock fund. It uses an index approach to track its benchmarks, Spliced Emerging Markets Index and MSCI All Country World Index ex USA. It invests in 21 emerging market countries including Brazil, Russia, China, India, and Indonesia.
This equity fund has a dividend rate is 2.61%. The expense ratio is only 0.33%. The total net assets are $61 billion. This index fund has no sales load. You can also invest in Vanguard MSCI Emerging Markets ETF (VWO). This is an Exchange Traded Fund (ETF), you may buy this from your brokerage or Vanguard Brokerage Service (VBS).
As of August 2015, the top 5 stocks in its assets Tencent Holdings Ltd, China Construction Bank Corp H Shares, China Mobile Ltd, Taiwan Semiconductor Manufacturing Co Ltd, and Industrial And Commercial Bank Of China Ltd H Shares. This fund has returned -15.20% over the past 1 year, and 5.56% over the past 10 year.
Fidelity Real Estate Income Fund (FRIFX)Fidelity Real Estate Income fund invests primarily in a portfolio of preferred and common stocks of REITs; debt securities of real estate entities; and commercial and other mortgage-backed securities. It may invest in domestic and foreign securities. This fund has a high yield of 4.58%. You can buy this real estate mutual fund with $2,500 initial funding. Its expense ratio is 0.83%.
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This best mutual fund for 2016 & 2017 is managed by Mark P. Snyderman. The top 3 sectors include real estate (96%), financial services (1.6%), and basic materials (1.60%). In 2015, the YTD return is 1.48%.
Vanguard Balanced Index Fund (VBINX)If you are a passive investor and hate to invest in many funds, you should consider Vanguard Balanced Index fund as one of your top investment choice for 2016 & 2017. This Vanguard Balanced Index fund invests in bonds and stocks. It uses 60% of assets to track the MSCI US Broad Market Index and 40% of assets to track Barclays Capital U.S. Aggregate Float Adjusted Index. It also has 0.24% expense ratio fee. You can buy this fund with $3,000 initial investment. The yield is 1.81%.
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Rank with gold rating, it has 5-year annualized return of 11.14%. In 2015, the year to date return is 1.68%. As one of the best mutual funds for 2016, this balanced fund is a great choice for passive investors.
Bonus FundsIf you are still young and has a long time horizon before retirement, you should consider the target date funds. You can invest these target date funds in your 401k account or IRA (individual retirement account). The following choices are best for you:
- T. Rowe Price Retirement 2055 Fund (TRRNX)
- Vanguard Target Retirement 2055 Fund (VFFVX)
|No||Fund Name (Ticker)||Yield||1 Year Return||3 Year Return|
|1||DoubleLine Total Return Bond Fund (DLTNX)||4.04%||3.24%||3.48%|
|2||Vanguard Total Stock Market Index Fund (VTSMX)||1.73%||8.75%||16.63%|
|3||USAA Tax Exempt Intermediate-Term (USATX)||3.32%||2.32%||2.92%|
|4||T. Rowe Price International Discovery Fund (PRIDX)||0.75%||5.90%||15.01%|
|5||DoubleLine Emerging Markets Fixed Income Fund (DLENX)||4.94%||-1.16%||2.74%|
|6||Vanguard Emerging Markets Stock Index (VEIEX)||2.61%||-15.20%||-0.96%|
|7||Fidelity Real Estate Income Fund (FRIFX)||4.58%||4.13%||7.92%|
|8||Vanguard Balanced Index Fund (VBINX)||1.81%||6.10%||10.45%|