Hybrid Funds Turn in Solid First-Quarter Results
The average hybrid fund lost around 5% to 6% for the quarter, which is by no means disastrous -- especially when some categories of stock funds averaged a loss of anywhere between 10% and 16% for the first quarter.
The allocation of assets under management to the debt markets, along with
Federal Reserve
intervention to stabilize the credit markets, put these funds' performance numbers right in the middle between pure stock funds (which performed worse) and the pure bond funds (which performed better).
On an individual basis, below are the best of the hybrid funds.
As we move into the second quarter, there are worse places you could put your money than in hybrid funds, but given that it is likely that the performance of the bond market will hold up hybrid fund results, it would be more prudent to seek out a good pure bond fund play if investors are of the opinion that the stock market and economy will continue to be weak in the coming months, and the Fed will continue to bail out the credit markets.
Certainly, Friday's earnings result from
General Electric
(GE) - Get Report
suggests that credit issues are not behind us yet.
Sam Patel, CFA, is the manager of mutual fund research for the TheStreet.com Ratings.
In keeping with TSC's Investment Policy, employees of TheStreet.com Ratings with access to pre-publication ratings data must pre-clear any potential trade through the legal department, and are prohibited from trading any security that is the subject of an unpublished rating revision until the second business day after the rating is published.
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