Best Funds for a Cautious Market Re-Entry

A mutual fund that combines different investment categories in "hybrid" vehicles might sound like a good idea to an investor hopeful of a market rebound but wishing for a muted exposure to equities.

But someone tempted by hybrid funds as investments for these treacherous times should check their performance in August, when stock prices were still rising. Four of the five hybrid fund classes tracked by TheStreet.com Ratings dropped in August, as can be seen in the left column in the accompanying table.

Nonetheless, a carefully chosen hybrid fund might be worth considering for someone convinced that the end of the investment world isn't at hand, but maybe a cautious reentry would be prudent. ...