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Is IHIFX a Strong Bond Fund Right Now?

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Having trouble finding a High Yield - Bonds fund? Ivy High Income N (IHIFX - Free Report) is a potential starting point. IHIFX bears a Zacks Mutual Fund Rank of 2 (Buy), which is based on nine forecasting factors like size, cost, and past performance.

Objective

We note that IHIFX 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

Delaware Investments is based in Philadelphia, PA, and is the manager of IHIFX. Ivy High Income N debuted in July of 2014. Since then, IHIFX has accumulated assets of about $67 million, according to the most recently available information. The fund is currently managed by Chad Gunther who has been in charge of the fund since July of 2014.

Performance

Obviously, what investors are looking for in these funds is strong performance relative to their peers. This fund in particular has delivered a 5-year annualized total return of 6.61%, and it sits in the middle third among its category peers. Investors who prefer analyzing shorter time frames should look at its 3-year annualized total return of 5.09%, which places it in the bottom 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. Compared to the category average of 14.28%, the standard deviation of IHIFX over the past three years is 11.21%. The fund's standard deviation over the past 5 years is 8.81% compared to the category average of 11.8%. This makes the fund less volatile than its peers over the past half-decade.

This fund has a beta of 0.28, meaning that it is less volatile than a broad market index of fixed income securities. Taking this into account, IHIFX has a positive alpha of 5.4, which measures performance on a risk-adjusted basis.

Expenses

Costs are increasingly important for mutual fund investing, and particularly as competition heats up in this market. And all things being equal, a lower cost product will outperform its otherwise identical counterpart, so taking a closer look at these metrics is key for investors. In terms of fees, IHIFX is a no load fund. It has an expense ratio of 0.60% compared to the category average of 1%. IHIFX is actually cheaper than its peers when you consider factors like cost.

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, Ivy High Income N ( IHIFX ) has a high Zacks Mutual Fund rank, and in conjunction with its comparatively similar performance, average downside risk, and lower fees, Ivy High Income N ( IHIFX ) looks like a great potential choice for investors right now.

For additional information on this product, or to compare it to other mutual funds in the High Yield - Bonds, make sure to go to www.zacks.com/funds/mutual-funds for additional information. Want to learn even more? We have a full suite of tools on stocks that you can use to find the best choices for your portfolio too, no matter what kind of investor you are.


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