Bond Funds With Winning Streaks

This morning's announcement of a 19.5% decline in mortgage applications over the past week was the worst since 2004. Yesterday's number on November building permits set a 14-year low.

In the category of better late than never, earlier this month Treasury Secretary Henry Paulson cajoled a large group of lenders into freezing the interest rates on subprime borrowers whose mortgages could be saved. And, in a pre-emptive move to avoid Congress from taking away its regulator authority, the Federal Reserve offered for comment on Tuesday new rules that could have helped to prevent the current crisis.

As turmoil the housing market spreads to the broader economy, it's driving a flight to quality in the fixed income market. The yield on the 10-year U.S. government debt has fallen by 120 basis points since June, sending prices in the opposite direction.

If you're looking for fixed-income investments, below is a list of bond funds that are on a winning streak. There are a ton of bond funds, so I have whittled the list down to just those we consider to be "Perpetual Bond Winners" by maintaining A- or better ratings for the last two years. These funds have an uninterrupted streak outperforming 90% of the open-end bond fund universe since September 2005.

This month TheStreet.com Ratings ranked and awarded letter grades to 5,333 open-end bond and money market mutual funds. Of these, 1,599 funds earned the equivalent of a "buy" rating with letter grades of B- or better. When you eliminate the multiple share classes, the number of "buy" rated funds drops to 598 unique funds.