The bull market has left most cautious stock fund managers in the dust. That's not to say you want people who are so paralyzed with fear that they run their funds like money markets. And you definitely don't want managers who are trailing the market because of their own incompetence, rather than their aversion to risk. The key is to separate the intelligently cautious from the totally clueless. That means we penalize funds that top the charts one month and tumble the next.
Steady performance is rewarded.
The screen also penalizes funds with sales charges, high turnover and above-average expenses. As boring as they may be, you can't ignore bonds in a safe-investment portfolio. They may not fly like stocks, but they won't crash and burn, either. If you are willing to put in the effort, you're better off buying individual bonds instead of bond funds. You can tailor a portfolio of bonds to exactly meet your circumstances, meaning the bonds will mature precisely when you need them.