A balanced fund is a mutual fund that holds stocks, bonds, and a small number of investments in money markets in a single portfolio. These funds frequently stick to an approximate constant equities-to-bonds ratio, such as 60/40 stocks-to-bonds. Equivalent amounts of debt and equity are held by balanced mutual funds, which have income and growth as their primary investment objectives. Thus, the term "balanced fund" is born.
Retirement investors or those with limited risk tolerance frequently choose balanced funds to encourage sound growth and supplemental income.
