Mutual funds investing in debt securities are among the most secure investment options which provide regular income while protecting capital invested. Funds which are part of this category bring a great deal of stability to portfolios with a large proportion of equity, while providing dividends more frequently than individual bonds. U.S. government bonds funds usually invest in Treasury bills, notes and securities issued by government agencies. They are considered to be the safest in the bond fund category and are ideal options for the risk-averse investor. Meanwhile, intermediate-term funds usually provide a safer option for investors, when compared to small-term funds. Fixed income securities having average maturity period between 3 and 10 years are classified as intermediate securities. These funds are believed to assure more stability and provide higher return than what short-term offer.

Below we will share with you 4 top government intermediate bond mutual funds. Each has earned either a Zacks #1 Rank (Strong Buy) or a Zacks #2 Rank (Buy) as we expect these mutual funds to outperform their peers in the future. To view the Zacks Rank and past performance of all government intermediate bond funds, investors can click here to see the complete list of funds.

Glenmede Core Fixed Income (GTCGX - MF report) seeks total return over the long run. The fund invests a lion’s share of its assets in fixed income instruments. A minimum of half of its assets get invested in securities that are affiliated with the U.S. government. The fund is expected to have average maturity duration between three and ten years. The government bond mutual fund has a five-year annualized return of 3.6%.

Stephen J. Mahoney is the fund manager and has managed this fund since 1999.

T. Rowe Price US Treasury Intermediate (PRTIX - MF report) invests a major portion of its assets in securities of the U.S. Treasury. The fund invests the rest of its assets in other derivatives that are approved by the U.S. government. The fund is expected to maintain mid-term average maturity period. It provides high income with credit protection and modest principal fluctuations. The government bond mutual fund has a five-year annualized return of 4.1%.

The fund has an expense ratio of 0.51% as compared to category average of 0.92%.

AMG Managers Intermediate Duration Government (MGIDX - MF report) seeks total return more than that of market indices related to mortgage-backed securities. The fund invests a majority of its assets in debt securities of domestic government or other agencies authorized by the government. It invests in securities having impressive credit quality to reduce risk. The fund seeks total return higher than that of the mortgage related indices. The government bond mutual fund has a five-year annualized return of 4%.

As of February 2015, this fund held 304 issues with 12.94% of its assets invested in Freddie Mac Gold Single Family TBA 4% 2044-04-01.

Vanguard Intermediate-Term Treasury Investor (VFITX - MF report) invests a large chunk of its assets in instruments of U.S. Treasury including bills, bonds, and notes. The fund generally has a dollar-weighted average maturity between 5 and 10 years. It seeks modest and consistent level of income over the long-term. The government bond mutual fund has a five-year annualized return of 4.2%.

The fund has an expense ratio of 0.20% as compared to category average of 0.92%.

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