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Have you been searching for a High Yield - Bonds fund? You might want to begin with Fidelity Floating Rate High Income (FFRHX - Free Report) . FFRHX bears a Zacks Mutual Fund Rank of 3 (Hold), which is based on nine forecasting factors like size, cost, and past performance.
Objective
We note that FFRHX is a High Yield - Bonds option, which is an area loaded with different investment choices. High Yield - Bonds funds are often known as " junk " bonds since they are below investment grade. This means they are at an elevated risk of default, at least when compared to their investment grade peers. On the plus side, junk bonds generally pay out higher yields, all while posing similar interest rate risks as we see with their investment grade counterparts.
History of Fund/Manager
Fidelity is based in Boston, MA, and is the manager of FFRHX. Fidelity Floating Rate High Income debuted in August of 2000. Since then, FFRHX has accumulated assets of about $4.89 billion, according to the most recently available information. The fund is currently managed by Eric Mollenhauer who has been in charge of the fund since April of 2013.
Performance
Of course, investors look for strong performance in funds. This fund in particular has delivered a 5-year annualized total return of 2.59%, and is in the top third among its category peers. But if you are looking for a shorter time frame, it is also worth looking at its 3-year annualized total return of 1.74%, which places it in the top third during this time-frame.
When looking at a fund's performance, it is also important to note the standard deviation of the returns. The lower the standard deviation, the less volatility the fund experiences. Over the past three years, FFRHX's standard deviation comes in at 7.87%, compared to the category average of 12.64%. The standard deviation of the fund over the past 5 years is 6.42% compared to the category average of 11.14%. This makes the fund less volatile than its peers over the past half-decade.
With a beta of 0.22, this fund is less volatile than a broad market index of fixed income securities. Taking this into account, FFRHX has a positive alpha of 1.36, which measures performance on a risk-adjusted basis.
Expenses
For investors, taking a closer look at cost-related metrics is key, since costs are increasingly important for mutual fund investing. Competition is heating up in this space, and a lower cost product will likely outperform its otherwise identical counterpart, all things being equal. In terms of fees, FFRHX is a no load fund. It has an expense ratio of 0.68% compared to the category average of 1.01%. From a cost perspective, FFRHX is actually cheaper than its peers.
Investors should also note that the minimum initial investment for the product is $0 and that each subsequent investment has no minimum amount.
Bottom Line
Overall, Fidelity Floating Rate High Income ( FFRHX ) has a neutral Zacks Mutual Fund rank, and in conjunction with its comparatively strong performance, average downside risk, and lower fees, Fidelity Floating Rate High Income ( FFRHX ) looks like a somewhat average choice for investors right now.
Your research on the High Yield - Bonds segment doesn't have to stop here. You can check out all the great mutual fund tools we have to offer by going to www.zacks.com/funds/mutual-funds to see the additional features we offer as well for additional information. If you want to check out our stock reports as well, make sure to go to Zacks.com to see all of the great tools we have to offer, including our time-tested Zacks Rank.
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Is FFRHX a Strong Bond Fund Right Now?
Have you been searching for a High Yield - Bonds fund? You might want to begin with Fidelity Floating Rate High Income (FFRHX - Free Report) . FFRHX bears a Zacks Mutual Fund Rank of 3 (Hold), which is based on nine forecasting factors like size, cost, and past performance.
Objective
We note that FFRHX is a High Yield - Bonds option, which is an area loaded with different investment choices. High Yield - Bonds funds are often known as " junk " bonds since they are below investment grade. This means they are at an elevated risk of default, at least when compared to their investment grade peers. On the plus side, junk bonds generally pay out higher yields, all while posing similar interest rate risks as we see with their investment grade counterparts.
History of Fund/Manager
Fidelity is based in Boston, MA, and is the manager of FFRHX. Fidelity Floating Rate High Income debuted in August of 2000. Since then, FFRHX has accumulated assets of about $4.89 billion, according to the most recently available information. The fund is currently managed by Eric Mollenhauer who has been in charge of the fund since April of 2013.
Performance
Of course, investors look for strong performance in funds. This fund in particular has delivered a 5-year annualized total return of 2.59%, and is in the top third among its category peers. But if you are looking for a shorter time frame, it is also worth looking at its 3-year annualized total return of 1.74%, which places it in the top third during this time-frame.
When looking at a fund's performance, it is also important to note the standard deviation of the returns. The lower the standard deviation, the less volatility the fund experiences. Over the past three years, FFRHX's standard deviation comes in at 7.87%, compared to the category average of 12.64%. The standard deviation of the fund over the past 5 years is 6.42% compared to the category average of 11.14%. This makes the fund less volatile than its peers over the past half-decade.
With a beta of 0.22, this fund is less volatile than a broad market index of fixed income securities. Taking this into account, FFRHX has a positive alpha of 1.36, which measures performance on a risk-adjusted basis.
Expenses
For investors, taking a closer look at cost-related metrics is key, since costs are increasingly important for mutual fund investing. Competition is heating up in this space, and a lower cost product will likely outperform its otherwise identical counterpart, all things being equal. In terms of fees, FFRHX is a no load fund. It has an expense ratio of 0.68% compared to the category average of 1.01%. From a cost perspective, FFRHX is actually cheaper than its peers.
Investors should also note that the minimum initial investment for the product is $0 and that each subsequent investment has no minimum amount.
Bottom Line
Overall, Fidelity Floating Rate High Income ( FFRHX ) has a neutral Zacks Mutual Fund rank, and in conjunction with its comparatively strong performance, average downside risk, and lower fees, Fidelity Floating Rate High Income ( FFRHX ) looks like a somewhat average choice for investors right now.
Your research on the High Yield - Bonds segment doesn't have to stop here. You can check out all the great mutual fund tools we have to offer by going to www.zacks.com/funds/mutual-funds to see the additional features we offer as well for additional information. If you want to check out our stock reports as well, make sure to go to Zacks.com to see all of the great tools we have to offer, including our time-tested Zacks Rank.