Best Bond Funds #2: Loomis Sayles Bond Fund (LSBRX)
Click to Enlarge Another multisector bond fund that takes a different approach to diversification is the Loomis Sayles Bond Fund (LSBRX). This fund seeks high total investment return through a combination of current income and capital appreciation. One of the interesting characteristics of LSBRX is that it may invest up to 20% of its assets in common or preferred stocks and up to 20% in international develop or emerging-market countries.
The manager believes that this non-traditional diversification strategy will enhance the long-term returns of the portfolio vs. its benchmark. A fund like LSBRX is hard to categorize because it has the ability to hold such a wide array of investment options in its arsenal. However, the historical results have impressive. It had a 2013 total return of 5.52%, three-year annualized return of 7.81%, and five-year annualized return of 14.20% according to the fund manager’s website.
The fund is currently managing nearly $22 billion in total assets with a 30-day SEC yield of 3.27%. If you are looking for a global strategy that offers a unique asset allocation slant, then LSBRX should definitely be on your radar.