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If you've been stuck searching for Mutual Fund Bond funds, consider Putnam Diversified Income A (PDINX - Free Report) as a possibility. PDINX carries a Zacks Mutual Fund Rank of 2 (Buy), which is based on nine forecasting factors like size, cost, and past performance.
History of Fund/Manager
Putnam Funds is based in Canton, MA, and is the manager of PDINX. Since Putnam Diversified Income A made its debut in October of 1988, PDINX has garnered more than $789.66 million in assets. The fund's current manager is a team of investment professionals.
Performance
Obviously, what investors are looking for in these funds is strong performance relative to their peers. This fund has delivered a 5-year annualized total return of 2.65%, and it sits in the middle third among its category peers. If you're interested in shorter time frames, do not dismiss looking at the fund's 3-year annualized total return of 0.85%, 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. PDINX's standard deviation over the past three years is 9.28% compared to the category average of 13.63%. The standard deviation of the fund over the past 5 years is 7.34% compared to the category average of 11.28%. This makes the fund less volatile than its peers over the past half-decade.
With a beta of 0.35, this fund is less volatile than a broad market index of fixed income securities. Taking this into account, PDINX has a positive alpha of 1.66, which measures performance on a risk-adjusted basis.
Ratings
Investors should also consider a bond's rating, which is a grade ( 'AAA' to 'D' ) given to a bond that indicates its credit quality. With this letter scale in mind, PDINX has 76.82% in high quality bonds rated at least 'AA' or higher, while its junk bond component-bonds rated 'BB' or below-is at 37.41%. This means that the fund has an average quality of AA, and focuses on high quality securities.
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, PDINX is a load fund. It has an expense ratio of 0.49% compared to the category average of 0.85%. So, PDINX is actually cheaper than its peers from a cost perspective.
Investors should also note that the minimum initial investment for the product is $500 and that each subsequent investment has no minimum amount.
Bottom Line
Overall, Putnam Diversified Income A ( PDINX ) has a high Zacks Mutual Fund rank, and in conjunction with its comparatively similar performance, average downside risk, and lower fees, Putnam Diversified Income A ( PDINX ) looks like a good potential choice for investors right now.
For additional information on the Mutual Fund Bond area of the mutual fund world, make sure to check out www.zacks.com/funds/mutual-funds. There, you can see more about the ranking process, and dive even deeper into PDINX too 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 PDINX a Strong Bond Fund Right Now?
If you've been stuck searching for Mutual Fund Bond funds, consider Putnam Diversified Income A (PDINX - Free Report) as a possibility. PDINX carries a Zacks Mutual Fund Rank of 2 (Buy), which is based on nine forecasting factors like size, cost, and past performance.
History of Fund/Manager
Putnam Funds is based in Canton, MA, and is the manager of PDINX. Since Putnam Diversified Income A made its debut in October of 1988, PDINX has garnered more than $789.66 million in assets. The fund's current manager is a team of investment professionals.
Performance
Obviously, what investors are looking for in these funds is strong performance relative to their peers. This fund has delivered a 5-year annualized total return of 2.65%, and it sits in the middle third among its category peers. If you're interested in shorter time frames, do not dismiss looking at the fund's 3-year annualized total return of 0.85%, 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. PDINX's standard deviation over the past three years is 9.28% compared to the category average of 13.63%. The standard deviation of the fund over the past 5 years is 7.34% compared to the category average of 11.28%. This makes the fund less volatile than its peers over the past half-decade.
With a beta of 0.35, this fund is less volatile than a broad market index of fixed income securities. Taking this into account, PDINX has a positive alpha of 1.66, which measures performance on a risk-adjusted basis.
Ratings
Investors should also consider a bond's rating, which is a grade ( 'AAA' to 'D' ) given to a bond that indicates its credit quality. With this letter scale in mind, PDINX has 76.82% in high quality bonds rated at least 'AA' or higher, while its junk bond component-bonds rated 'BB' or below-is at 37.41%. This means that the fund has an average quality of AA, and focuses on high quality securities.
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, PDINX is a load fund. It has an expense ratio of 0.49% compared to the category average of 0.85%. So, PDINX is actually cheaper than its peers from a cost perspective.
Investors should also note that the minimum initial investment for the product is $500 and that each subsequent investment has no minimum amount.
Bottom Line
Overall, Putnam Diversified Income A ( PDINX ) has a high Zacks Mutual Fund rank, and in conjunction with its comparatively similar performance, average downside risk, and lower fees, Putnam Diversified Income A ( PDINX ) looks like a good potential choice for investors right now.
For additional information on the Mutual Fund Bond area of the mutual fund world, make sure to check out www.zacks.com/funds/mutual-funds. There, you can see more about the ranking process, and dive even deeper into PDINX too 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.