TheStreet.com Adds Ratings on 10 Fixed-Income Funds

Potential relief from erosion of the greenback is offered by six of the 10 open-end fixed-income funds added to the population rated by TheStreet.com Ratings in May.

Some of the funds in the accompanying table of newly rated fixed-income funds fight depreciation of the U.S. dollar by investing in inflation-protected fixed-income securities, while others offer protection by opting for bonds denominated in foreign currencies.

For those seeking income streams possibly immune to the erosive forces of inflation, two offerings on the list may offer help.

The American Century Inflation Protection Bond Fund(APOAX Quote - Cramer on APOAX - Stock Picks) invests at least 80% of its assets in inflation-linked debt securities. Included in this category are inflation-linked U.S. Treasury securities and inflation-linked securities issued by other entities such as domestic and foreign corporations and governments.

Similarly, the institutional Western Asset Trust Inflation Indexed Plus Bond Fund(WAIIX Quote - Cramer on WAIIX - Stock Picks) invests at least 80% of its net assets in inflation-indexed fixed-income securities and at least 70% of net assets in U.S. Treasury inflation protected securities, or TIPs. It may also invest up to 30% of assets in securities rated below AAA but are at least Baa/BBB. It can engage in reverse repurchase agreements and borrow money for temporary or emergency purposes.

A pair of entries from specialty fund manager Rydex address another current concern: the fluctuating -- mostly downward -- U.S. dollar.

For those who feel the greenback will continue to erode in value relative to other major currencies, the Rydex Series Dynamic Weakening Dollar 2x Strategy Fund(RYWDX Quote - Cramer on RYWDX - Stock Picks) tracks the inverse of the U.S. dollar relative to a basket of other currencies. It employs as its investment strategy a program of investing in derivative instruments, such as index swaps, futures contracts, options on securities and repurchase agreements.

On a day-to-day basis, the fund holds U.S. government securities or cash equivalents to collateralize its various derivative positions. The holdings of government securities and cash equivalents qualify it as a fixed-income investment.

RYWDX's near-mirror image, the Rydex Series Dynamic Strengthening Dollar 2x Strategy Fund(RYSDX Quote - Cramer on RYSDX - Stock Picks), employs strategies similar to its sibling, except that its objective is to return double the value of the greenback relative to a basket of international currencies.

Another pair of funds on the list provide possible protection against dollar weakness by focusing their investments beyond our shores, thereby gaining exposure to currencies other than the U.S. dollar.

The institutional Western Asset Trust Non-U.S. Opportunity Bond Portfolio(WAFIX Quote - Cramer on WAFIX - Stock Picks) invests in bonds of major nations, many of whose currencies have been appreciating relative to the dollar. So its holders get a possible double-barreled impact; interest on the foreign bonds and appreciation of the currencies vis-à-vis the greenback.

The PIMCO Developing Local Markets Fund(PLMAX Quote - Cramer on PLMAX - Stock Picks) takes a riskier approach, aiming for greater returns by investing in bonds of developing markets.

A more conventional approach to outdistancing inflation is to achieve a return higher than the inflation rate. That's the approach of the DWS High Income Plus Fund(SGHAX Quote - Cramer on SGHAX - Stock Picks), which aims for above-average dividends by investing in high-yield corporate bonds. But it also doesn't ignore international opportunities, as it may invest up to 25% of assets in U.S. dollar-denominated securities of foreign issuers.

FIXED-INCOME FUNDS NEWLY RATED BY THESTREET.COM RATINGS
NAME, TICKER & THESTREET.COM RATINGS GRADE	MIN. INIT. INVEST- MENT	YR-TO- DATE TOTAL RET'N (%)	12-MO. TOTAL RET'N (%)	3-YR. ANN'L RET'N (%)
American Century Infl Prot Bd A (APOAX) C	2,500	3.37	13.10	4.52
Columbia Sh Inter Bond Fund A (CHOAX) C	2,500	0.66	5.76	3.72
DWS CAT Tax-Exempt Port Svc (CHSXX) C	1,000	0.67	2.24	2.27
DWS High Income Plus A (SGHAX) D-	1,000	0.70	-2.85	5.56
PIMCO Developing Local Mkt A (PLMAX) C+	5,000	6.11	13.90	11.59
Rydex Ser-Dyn Strgh Dlr 2x Strtgy A (RYSDX) E-	2,500	-10.31	-19.68	-7.63
Rydex Ser-Dyn Wekng Dlr 2x Stgry A (RYWDX) C	2,500	11.18	27.29	12.09
Transamerica Prt Total Return Bond (DVTRX) D	5,000	-1.93	0.22	1.86
Western Asset Tr-Inf Idx Plus Bd I (WAIIX) C+	1,000,000	2.76	11.45	5.07
Western Asset Tr-Non US Opp Bd Inst (WAFIX) D	1,000,000	-1.61	1.46	2.21
Source: TheStreet.com Ratings - Data as of 5/31/2008. For an explanation of our ratings, click here.