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When worries about economic growth and market volatility cause clients to ask repeatedly about risk management, advisers often turn the conversation to standard deviation. Funds that focus on this measure of variation, generally ensuring more stability, come at a price, at least in terms of forgone returns.

Of course, when it comes to investment returns, stability can be sexy, so we’ve gathered all the mutual funds with at least $500 million in assets and standard deviations of less than 3%. We list 20 funds ranked by three-year returns.

These options are not dirt cheap. Expense ratios ranged from about 50 to 100 basis points, and two funds were over the 1% mark. All data from Morningstar.
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20. Delaware Tax-Free MN A

3-Yr. Return: 3.38%
Standard Deviation: 2.75%
Expense Ratio: 0.85%
Total Assets (millions): $563
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19. JHancock Strategic Income Opps NAV

3-Yr. Return: 3.38%
Standard Deviation: 2.25%
Expense Ratio: 0.66%
Total Assets (millions): $7,368
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18. Eaton Vance Glbl Macr Absolute Return

3-Yr. Return: 3.41%
Standard Deviation: 2.33%
Expense Ratio: 1.03%
Total Assets (millions): $5,997
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17. USAA VA Bond

3-Yr. Return: 3.47%
Standard Deviation: 2.79%
Expense Ratio: 0.60%
Total Assets (millions): $696
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16. American Century Global Bond R5

3-Yr. Return: 3.48%
Standard Deviation: 2.67%
Expense Ratio: 0.64%
Total Assets (millions): $1,319
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15. Angel Oak Multi-Strategy Income

3-Yr. Return: 3.48%
Standard Deviation: 2.77%
Expense Ratio: 1.25%
Total Assets (millions): $5,393
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14. Putnam Tax Exempt Income

3-Yr. Return: 3.53%
Standard Deviation: 2.89%
Expense Ratio: 0.77%
Total Assets (millions): $920
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13. T. Rowe Price VA Tax-Free Bond

3-Yr. Return: 3.62%
Standard Deviation: 2.90%
Expense Ratio: 0.47%
Total Assets (millions): $1,206
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12. T. Rowe Price MD Tax-Free Bond

3-Yr. Return: 3.67%
Standard Deviation: 2.76%
Expense Ratio: 0.46%
Total Assets (millions): $2,251
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11. USAA Tax Exempt Long-Term

3-Yr. Return: 3.68%
Standard Deviation: 2.89%
Expense Ratio: 0.51%
Total Assets (millions): $2,395
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10. AB Global Bond

3-Yr. Return: 3.70%
Standard Deviation: 2.69%
Expense Ratio: 0.83%
Total Assets (millions): $6,628
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9. Franklin OH Tax-Free Inc

3-Yr. Return: 3.75%
Standard Deviation: 2.93%
Expense Ratio: 0.63%
Total Assets (millions): $1,608
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8. USAA CA Bond

3-Yr. Return: 3.76%
Standard Deviation: 3.00%
Expense Ratio: 0.56%
Total Assets (millions): $688
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7. Credit Suisse Floating Rate Hi Inc

3-Yr. Return: 3.83%
Standard Deviation: 2.94%
Expense Ratio: 0.95%
Total Assets (millions): $3,461
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6. Waddell & Reed Muni Hi-Inc

3-Yr. Return: 3.86%
Standard Deviation: 2.90%
Expense Ratio: 0.88%
Total Assets (millions): $786
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5. BNY Mellon Corporate Bond

3-Yr. Return: 3.89%
Standard Deviation: 2.96%
Expense Ratio: 0.56%
Total Assets (millions): $771
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4. GMO Opportunistic Income

3-Yr. Return: 4.08%
Standard Deviation: 1.20%
Expense Ratio: 0.46%
Total Assets (millions): $1,250
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3. Touchstone Flexible Income

3-Yr. Return: 4.36%
Standard Deviation: 2.77%
Expense Ratio: 0.86%
Total Assets (millions): $711
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2. Colorado BondShares A Tax-Exempt

3-Yr. Return: 4.56%
Standard Deviation: 1.45%
Expense Ratio: 0.55%
Total Assets (millions): $1,109
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1. Performance Trust Strategic Bond

3-Yr. Return: 5.36%
Standard Deviation: 2.15%
Expense Ratio: 0.82%
Total Assets (millions): $949
Lee Conrad
Former senior editor, Employee Benefit News and Employee Benefit Adviser
Mutual funds Risk management Investment strategies
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