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There are plenty of choices in the Mutual Fund Bond category, but where should you start your research? Well, one fund that you should consider investigating is Wells Fargo Municipals Bond Fund A (WMFAX - Free Report) . WMFAX carries a Zacks Mutual Fund Rank of 3 (Hold), which is based on nine forecasting factors like size, cost, and past performance.
History of Fund/Manager
Wells Fargo is based in San Francisco, CA, and is the manager of WMFAX. Since Wells Fargo Municipals Bond Fund A made its debut in April of 2005, WMFAX has garnered more than $1.07 billion in assets. The fund is currently managed by a team of investment professionals.
Performance
Investors naturally seek funds with strong performance. This fund in particular has delivered a 5-year annualized total return of 4.24%, and it sits in the top third among its category peers. Investors who prefer analyzing shorter time frames should look at its 3-year annualized total return of 4.65%, which places it in the middle 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, WMFAX's standard deviation comes in at 4.41%, compared to the category average of 13.13%. The standard deviation of the fund over the past 5 years is 3.65% compared to the category average of 10.95%. This makes the fund less volatile than its peers over the past half-decade.
With a beta of 0.66, this fund is less volatile than a broad market index of fixed income securities. Taking this into account, WMFAX has a negative alpha of -0.24, 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, WMFAX has 43.03% in high quality bonds rated at least 'AA' or higher, while 44.26% are of medium quality, with ratings of 'A' to 'BBB'. The fund has an average quality of A, and focuses on high quality securities.
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, WMFAX is a load fund. It has an expense ratio of 0.77% compared to the category average of 0.80%. From a cost perspective, WMFAX is actually cheaper than its peers.
Investors need to be aware that with this product, the minimum initial investment is $1,000; each subsequent investment needs to be at least $100.
Bottom Line
Overall, Wells Fargo Municipals Bond Fund A ( WMFAX ) has a neutral Zacks Mutual Fund rank, and in conjunction with its comparatively strong performance, better downside risk, and lower fees, this fund looks like a somewhat average choice for investors right now.
Your research on the Mutual Fund Bond 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. For analysis of the rest of your portfolio, make sure to visit Zacks.com for our full suite of tools which will help you investigate all of your stocks and funds in one place.
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Is WMFAX a Strong Bond Fund Right Now?
There are plenty of choices in the Mutual Fund Bond category, but where should you start your research? Well, one fund that you should consider investigating is Wells Fargo Municipals Bond Fund A (WMFAX - Free Report) . WMFAX carries a Zacks Mutual Fund Rank of 3 (Hold), which is based on nine forecasting factors like size, cost, and past performance.
History of Fund/Manager
Wells Fargo is based in San Francisco, CA, and is the manager of WMFAX. Since Wells Fargo Municipals Bond Fund A made its debut in April of 2005, WMFAX has garnered more than $1.07 billion in assets. The fund is currently managed by a team of investment professionals.
Performance
Investors naturally seek funds with strong performance. This fund in particular has delivered a 5-year annualized total return of 4.24%, and it sits in the top third among its category peers. Investors who prefer analyzing shorter time frames should look at its 3-year annualized total return of 4.65%, which places it in the middle 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, WMFAX's standard deviation comes in at 4.41%, compared to the category average of 13.13%. The standard deviation of the fund over the past 5 years is 3.65% compared to the category average of 10.95%. This makes the fund less volatile than its peers over the past half-decade.
With a beta of 0.66, this fund is less volatile than a broad market index of fixed income securities. Taking this into account, WMFAX has a negative alpha of -0.24, 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, WMFAX has 43.03% in high quality bonds rated at least 'AA' or higher, while 44.26% are of medium quality, with ratings of 'A' to 'BBB'. The fund has an average quality of A, and focuses on high quality securities.
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, WMFAX is a load fund. It has an expense ratio of 0.77% compared to the category average of 0.80%. From a cost perspective, WMFAX is actually cheaper than its peers.
Investors need to be aware that with this product, the minimum initial investment is $1,000; each subsequent investment needs to be at least $100.
Bottom Line
Overall, Wells Fargo Municipals Bond Fund A ( WMFAX ) has a neutral Zacks Mutual Fund rank, and in conjunction with its comparatively strong performance, better downside risk, and lower fees, this fund looks like a somewhat average choice for investors right now.
Your research on the Mutual Fund Bond 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. For analysis of the rest of your portfolio, make sure to visit Zacks.com for our full suite of tools which will help you investigate all of your stocks and funds in one place.