(Editor's note: TheStreet today named 111 mutual funds and exchange traded funds, or ETFs, winners and runners-up in its first annual awards ceremony. A list of the funds and related articles can be found on the awards page.)NEW YORK ( TheStreet) -- Worried that rising interest rates could punish bonds, investors have been dumping some fixed-income funds in recent months. During the first quarter of this year, intermediate-term bond funds had outflows of $4.8 billion, while intermediate-term government funds lost $5.9 billion. But not all bond funds have lost assets. Among the gainers are emerging market bond funds, which have attracted $2.5 billion. Solid returns have been attracting investors. During the past three years, emerging bond funds have gained 7.7% annually, compared to a return of 5.8% for the Barclays Capital Aggregate Bond Index. To participate in emerging markets, consider Payden Emerging Markets Bond ( PYEMX). In the three years through Dec. 31, the fund returned 9.3% annually. Taking into account lower-than-average risks, the fund won TheStreet's 2011 Best Mutual Fund award in the fixed-income emerging markets category. This year, Payden Emerging Markets Bond is up 1.1%. The runner-up is TCW Emerging Markets Income Fund ( TGEIX).
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