MassMutual Financial Group was founded in 1851 and has a strong track record of performance and honesty. The Ethisphere Institute awarded MassMutual the 2015 World’s Most Ethical Company award for continued integrity in its business operations and making a positive impact in its community. The ethics award is important, because not only has MassMutual been around since before the American Civil War, but the firm also has strong values that put the client first.

Diversifying your portfolio’s fund family makeup is important because different fund families have different methods and operating procedures. Allocating all of your portfolio into one fund family is not beneficial and certainly leaves an investor exposed to underperformance. MassMutual has seen total fund family returns of 13.35% for the past three years and 12.02% for the past five years as of July 2015. Furthermore, assets under management (AUM) have risen from $20.8 billion in 2012 to $26.8 billion as of July 2015. Following are the top two MassMutual mutual funds with strong five-star ratings from Morningstar to consider for diversification in 2016.

MassMutual Premier High Yield I Fund (DLHYX)

The MassMutual Premier High Yield I Fund is classified as a high-yield bond fund with five stars from Morningstar Investment Research. The mutual fund carries no load charge; it has expenses of 0.75% and offers a yield of 6.29%. 

The average duration of the high-yield bond portfolio’s holdings is 4.25 years, and the holdings carry an average credit quality rating of B. Over 90% of the portfolio is held in corporate high-yield bonds, 5.63% in government bonds and 1.33% in mortgage-backed securities. The top three geographical allocations are 84.29% for the United States, 7.31% for Luxembourg and 3% for Canada.

MassMutual Select Blue Chip Growth I Fund (MBCLX)

The MassMutual Select Blue Chip Growth I Fund is classified as a large-growth mutual fund with five stars from Morningstar. The fund carries no load charge; it has expenses of 0.97% and offers a yield of 0.23%. 

For the fund’s asset allocation, nearly 90% of the portfolio is held in U.S. stocks and around 9.50% is held in non-U.S. stocks. Giant-cap stocks hold majority exposure of the mutual fund with 53.80% allocation, followed by 37.08% in large caps and 9.02% in mid-cap stocks. The top three sectors by weight include technology at 24.47%, consumer cyclicals at 22.87% and health care at 22.13%. The fund’s non-U.S. holdings are held in European stocks at 4.62% and Asian stocks at 4.02%.

 

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