Fund Watch
Dodge & Cox Balanced: The Best of Both Worlds
This fund, which invests in both stocks and bonds, has delivered superior returns with relatively low volatility.
By Andrew Tanzer, Senior Associate Editor, Kiplinger's Personal Finance
January 29, 2007
Editor's note: This is part of a continuing series of articles looking at the 20 biggest no-load stock funds.
Dodge & Cox is so well known for its stock-picking prowess that people sometimes forget that the low-profile, San Francisco-based fund manager is also a dab hand at investing in bonds. Both skills are on display in Dodge & Cox Balanced, which borrows liberally from its two siblings, Dodge & Cox Stock and Dodge & Cox Income, a bond fund.
What you get with Balanced is a fund that has delivered outstanding returns with relatively low volatility. Over the past decade, the fund has returned 12% annualized, nearly five percentage points better than the average return of all balanced funds. In only one of those years did Balanced rank worse than 40% of funds in its category.
Dodge & Cox has a fairly unorthodox way of researching and picking bonds. The same team of analysts studies both stocks and bonds. "If we have a very positive outlook for the long-term growth and success of a company, it makes us interested in buying the bond," says Charles Pohl, co-director of research.
Alas, Balanced is closed to new investors, but Dodge & Cox Income (DODIX), which remains open, is a fine choice for conservative bond investors. If you currently hold Balanced and like the allocation, feel free to BUY more.
Read about other D&C funds: Dodge & Cox Stock and Dodge & Cox International Stock.
To learn more about the fund firm, see The Dodge & Cox Mystique, an interview with two D&C veterans.
FUND FACTS |
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Dodge & Cox Balanced (DODBX) |
View updated data for this fund and compare the performance of the 20 biggest no-load stock funds.
Go to A Close Look at the 20 Biggest No-Load Stock Funds.
