Six Bond Funds With Consistent 'Real' Returns
With a total return of 0.36% in 2008, the Colorado Bond Shares Tax-Exempt Fund (HICOX) deserves 12 cheers.
While the fund's fractional gain might not seem impressive at first glance, it was higher than the 2008 inflation rate of 0.1% the government announced Friday. By besting the CPI, HICOX was able to produce a positive "real" annual return for its holders. Its return in 2007 also surpassed the gain in the consumer price index, as it did in the previous year, and the year before that, and again and again and again.
In fact, the double-tax-exempt HICOX turns out to be the only fixed-income fund in TheStreet.com Ratings' database to have achieved 12 consecutive annual returns, besting the corresponding gains in the CPI. Its singular achievement is summarized in the table below.
An investor in search of a bond fund consistently producing gains exceeding the annual inflation rate will find that the quest is anything but a slam dunk. It turns out that even with supposedly steady fixed-income funds, lengthy annual strings of positive "real" returns are surprisingly elusive.
Select the service that is right for you!COMPARE ALL SERVICES
- $2.5+ million portfolio
- Large-cap and dividend focus
- Intraday trade alerts from Cramer
- Weekly roundups
Access the tool that DOMINATES the Russell 2000 and the S&P 500.
- Buy, hold, or sell recommendations for over 4,300 stocks
- Unlimited research reports on your favorite stocks
- A custom stock screener
- Upgrade/downgrade alerts
- Diversified model portfolio of dividend stocks
- Alerts when market news affect the portfolio
- Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
- Real Money + Doug Kass Plus 15 more Wall Street Pros
- Intraday commentary & news
- Ultra-actionable trading ideas
- 100+ monthly options trading ideas
- Actionable options commentary & news
- Real-time trading community
- Options TV