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These exchange-traded funds own either convertible bonds or a blend of stocks and bonds.

“Balanced” is a century-old way to describe a portfolio mixing stocks and bonds. Nowadays marketers feel they can get more mileage out of the term “allocation,” but the concept is the same: Investors often want to blend the safety of fixed income with the inflation defenses of equity.

The iShares Core Moderate Allocation fund (AOM), for example, has half your money in bonds and half in a very diverse collection of stocks from the U.S., developed markets and emerging markets. It’s a fund of funds. With a waiver that brings its expense ratio (including expenses of the underlying funds) down to 0.25%, it’s not a bad buy.

You could, though, save a few pennies by owning positions in the underlying funds. In a taxable account, purchasing the components instead of the blend has the added advantage of offering better opportunities for tax loss harvesting. (If stocks go up and bonds down, you’d sell the bond fund.)

[Looking&nbsp;for an exchange-traded fund?&nbsp;See the&nbsp;full coverage&nbsp;of Forbes Best ETFs.]

We include, in this small category, two funds that invest in convertibles. These are securities that are themselves a blend of stocks and bonds. The cheaper of the two merits a slot on the Best ETFs Honor Roll.

Best ETFs: Balanced Funds

&nbsp;Ticker &nbsp;Exchange-Traded Fund Holding Cost1 Liquidity Score2 Assets ($bil)
ICVT iShares Convertible Bond $363 C 0.3
AOR iShares Core Growth Allocation 378 B 1.1
AOA iShares Core Aggressive Allocation 384 B 0.9
AOM iShares Core Moderate Allocation 395 B 0.9
AOK iShares Core Conservative Allocation 410 C 0.5
GAA Cambria Global Asset Allocation 517 D 0.1
CWB SPDR Blmbg Barclays Convert Secs 561 A 4.4
IYLD iShares Morningstar Multi-Asset Income 564 C 0.3
GAL SPDR SSgA Global Allocation 613 D 0.3

1 Cumulative cost of holding a $10,000 position for a decade. Incorporates annual expense ratio, bid/ask spreads and cost offset from securities lending. 2Reflects bid/ask spreads and trading volume. A = easy to trade.

Data sources: Morningstar; Bloomberg; fund distributors.

Best ETFs: How we rated 737 funds

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Shutterstock(Wingdale NY)

These exchange-traded funds own either convertible bonds or a blend of stocks and bonds.

“Balanced” is a century-old way to describe a portfolio mixing stocks and bonds. Nowadays marketers feel they can get more mileage out of the term “allocation,” but the concept is the same: Investors often want to blend the safety of fixed income with the inflation defenses of equity.

The iShares Core Moderate Allocation fund (AOM), for example, has half your money in bonds and half in a very diverse collection of stocks from the U.S., developed markets and emerging markets. It’s a fund of funds. With a waiver that brings its expense ratio (including expenses of the underlying funds) down to 0.25%, it’s not a bad buy.

You could, though, save a few pennies by owning positions in the underlying funds. In a taxable account, purchasing the components instead of the blend has the added advantage of offering better opportunities for tax loss harvesting. (If stocks go up and bonds down, you’d sell the bond fund.)

[Looking for an exchange-traded fund? See the full coverage of Forbes Best ETFs.]

We include, in this small category, two funds that invest in convertibles. These are securities that are themselves a blend of stocks and bonds. The cheaper of the two merits a slot on the Best ETFs Honor Roll.

Best ETFs: Balanced Funds

 Ticker  Exchange-Traded Fund Holding Cost1 Liquidity Score2 Assets ($bil)
ICVT iShares Convertible Bond $363 C 0.3
AOR iShares Core Growth Allocation 378 B 1.1
AOA iShares Core Aggressive Allocation 384 B 0.9
AOM iShares Core Moderate Allocation 395 B 0.9
AOK iShares Core Conservative Allocation 410 C 0.5
GAA Cambria Global Asset Allocation 517 D 0.1
CWB SPDR Blmbg Barclays Convert Secs 561 A 4.4
IYLD iShares Morningstar Multi-Asset Income 564 C 0.3
GAL SPDR SSgA Global Allocation 613 D 0.3

1 Cumulative cost of holding a $10,000 position for a decade. Incorporates annual expense ratio, bid/ask spreads and cost offset from securities lending. 2Reflects bid/ask spreads and trading volume. A = easy to trade.

Data sources: Morningstar; Bloomberg; fund distributors.

Best ETFs: How we rated 737 funds

Originally published at Forbes

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