Skip to main content

Nirvana for many mutual fund investors would be to own funds whose managers who could switch from equities to fixed-income investments in a manner that would keep their holdings on upstream courses while avoiding market turbulence.

The 40 funds populating the three sections of the adjoining table are the most recent group -- from April of this year -- to receive evaluation from Ratings. "Asset allocation" funds, whose intentions are to fulfill those investor dreams, dominate the "buy-recommended" and "hold-recommended" sections of the table.

It's a possible indication that mutual fund companies are striving to accommodate investors who would like their equity/fixed income portfolio blends customized for what managers deem to be the appropriate risk/reward environment of the moment.

The list is partitioned into "buy," "hold" and "sell" sections by the funds' respective grade levels.

Asset allocation funds -- where managers can switch assets between dominant positions in equities and fixed-income securities as they see fit -- are frequently viewed as freewheelers with a tendency to ride on the wild side.

The trio of asset allocators in the top section of the table appears to be of a more conservative bent. The word "Moderate" in the names of the

AIM Moderate Growth Allocation Fund


, the

MainStay Moderate Allocation Fund

(MMRAX) - Get MainStay Moderate Allocation A Report

and the

MainStay Moderate Growth Allocation Fund

(MGDAX) - Get MainStay Moderate Gr Allocation A Report

signals fund managements that switch their respective asset mixes with a fairly conservative risk profile.

The trend toward a more moderate approach to asset allocation spilled onto the middle list of 21 funds with grades in the "C" range, which equates with "hold" recommendations.

TheStreet Recommends

Among the many asset allocation funds in the "hold" sectio are these with names that reveal their conservative intentions:

AIM Moderately Conservative Allocation

(CAAMX) - Get Invesco Conservative Allocation A Report


Calvert Conservative Allocation

(CCLAX) - Get Calvert Conservative Alloc A Report


Calvert Moderate Allocation

(CMAAX) - Get Calvert Moderate Alloc A Report


MainStay Conservative Allocation

(MCKAX) - Get MainStay Conservative Allocation A Report


Oppenheimer Conservative Investment Fund

(OACIX) - Get Invesco Oppenheimer Consv A Report

; and

Oppenheimer Moderate Investment Fund

(OAMIX) - Get Invesco Oppenheimer Mod Inv A Report


The proliferation of new asset allocation offerings by open-end fund managements is a possible attempt to neutralize the growing popularity of exchange traded funds. Most ETFs are passively managed, meaning that their asset allocations toward equities or fixed-income investments remain static.

With two emerging markets funds on the "buy-recommended" list joined by a non-U.S. equity fund and a global real estate entry, funds with worldwide investment scopes gained their share of representation on the "buy" side

Five of the newly ranked "buy-recommended" funds in the top section of the table belong to the

Columbia Funds

family of

Bank of America

(BAC) - Get Bank of America Corp Report

. Columbia also placed two funds on the list's "hold-recommended" grouping, including the

Columbia Energy & Natural Resources Fund

(EENAX) - Get Columbia Glb Energy & Nat Res Fd A Report

, which has rewarded its holders with a total return of 20.34% over the past three months, 32.48% over the past year and 32.76% annualized over the past three years.

Richard Widows is a senior financial analyst for Ratings. Prior to joining, Widows was senior product manager for quantitative analytics at Thomson Financial. After receiving an M.B.A. from Santa Clara University in California, his career included development of investment information systems at data firms, including the Lipper division of Reuters. His international experience includes assignments in the U.K. and East Asia.