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April 01, 2005 at 02:00 AM
Flexible hybrid funds are a special class of balanced funds that have the leeway to invest in a range of securities, including commodities, real estate, and short positions, as well as stocks and bonds, in whatever allocations the managers deem attractive at the time. In contrast, the typical balanced fund usually keeps a 60% to 40% mix, or thereabouts, of only stocks and bonds.
One of the best long-term performers in this sector class, the $690 million Leuthold Core Investment Fund (LCORX), can hold anywhere from 30% to 70% of its assets in either equities or bonds. However, during periods of extreme market activity, the portfolio may have significant investments in money market instruments, foreign securities, or other assets.
Lead-managed by Steven C. Leuthold, chairman of Leuthold Weeden Capital Management, the fund has a high minimum initial investment requirement of $10,000. However, over the five years through 2004, the fund has beaten its benchmark, the S&P 500 Index, with an 8.14% annualized gain, versus a 0.52% drop by the Index. Moreover, it outperformed with significantly less volatility.
