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Mutual Fund Bond fund seekers should not consider taking a look at Franklin Federal Tax-Free Inc A1 (FKTIX - Free Report) at this time. FKTIX bears a Zacks Mutual Fund Rank of 4 (Sell), which is based on various forecasting factors like size, cost, and past performance.
History of Fund/Manager
Franklin is based in San Mateo, CA, and is the manager of FKTIX. Franklin Federal Tax-Free Inc A1 made its debut in October of 1983, and since then, FKTIX has accumulated about $4.84 billion in assets, per the most up-to-date date available. A team of investment professionals is the fund's current manager.
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 1.4%, and it sits in the middle 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 -1.64%, which places it in the middle third during this time-frame.
It is important to note that the product's returns may not reflect all its expenses. Any fees not reflected would lower the returns. Total returns do not reflect the fund's [%] sale charge. If sales charges were included, total returns would have been lower.
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. FKTIX's standard deviation over the past three years is 8.39% compared to the category average of 13.16%. Looking at the past 5 years, the fund's standard deviation is 7.22% compared to the category average of 13.6%. This makes the fund less volatile than its peers over the past half-decade.
With a beta of 1.08, this fund is more volatile than a broad market index of fixed income securities. Taking this into account, FKTIX has a negative alpha of -0.61, 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, FKTIX has 38.8% in high quality bonds rated at least 'AA' or higher, while 45.1% 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
As competition heats up in the mutual fund market, costs become increasingly important. Compared to its otherwise identical counterpart, a low-cost product will be an outperformer, all other things being equal. Thus, taking a closer look at cost-related metrics is vital for investors. In terms of fees, FKTIX is a load fund. It has an expense ratio of 0.64% compared to the category average of 0.90%. Looking at the fund from a cost perspective, FKTIX is actually cheaper than its peers.
Investors should also note, that according to our data, the fund does not have any minimum investment requirements.
Fees charged by investment advisors have not been taken into considiration. Returns would be less if those were included.
Bottom Line
Overall, even with its comparatively similar performance, better downside risk, and lower fees, Franklin Federal Tax-Free Inc A1 ( FKTIX ) has a low Zacks Mutual Fund rank, and therefore looks a somewhat weak choice for investors right now.
Don't stop here for your research on Mutual Fund Bond funds. We also have plenty more on our site in order to help you find the best possible fund for your portfolio. Make sure to check out www.zacks.com/funds/mutual-funds for more information about the world of funds, and feel free to compare FKTIX to its peers as well for additional information. And don't forget, Zacks has all of your needs covered on the equity side too! Make sure to check out Zacks.com for more information on our screening capabilities, Rank, and all our articles as well.
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Is FKTIX a Strong Bond Fund Right Now?
Mutual Fund Bond fund seekers should not consider taking a look at Franklin Federal Tax-Free Inc A1 (FKTIX - Free Report) at this time. FKTIX bears a Zacks Mutual Fund Rank of 4 (Sell), which is based on various forecasting factors like size, cost, and past performance.
History of Fund/Manager
Franklin is based in San Mateo, CA, and is the manager of FKTIX. Franklin Federal Tax-Free Inc A1 made its debut in October of 1983, and since then, FKTIX has accumulated about $4.84 billion in assets, per the most up-to-date date available. A team of investment professionals is the fund's current manager.
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 1.4%, and it sits in the middle 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 -1.64%, which places it in the middle third during this time-frame.
It is important to note that the product's returns may not reflect all its expenses. Any fees not reflected would lower the returns. Total returns do not reflect the fund's [%] sale charge. If sales charges were included, total returns would have been lower.
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. FKTIX's standard deviation over the past three years is 8.39% compared to the category average of 13.16%. Looking at the past 5 years, the fund's standard deviation is 7.22% compared to the category average of 13.6%. This makes the fund less volatile than its peers over the past half-decade.
With a beta of 1.08, this fund is more volatile than a broad market index of fixed income securities. Taking this into account, FKTIX has a negative alpha of -0.61, 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, FKTIX has 38.8% in high quality bonds rated at least 'AA' or higher, while 45.1% 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
As competition heats up in the mutual fund market, costs become increasingly important. Compared to its otherwise identical counterpart, a low-cost product will be an outperformer, all other things being equal. Thus, taking a closer look at cost-related metrics is vital for investors. In terms of fees, FKTIX is a load fund. It has an expense ratio of 0.64% compared to the category average of 0.90%. Looking at the fund from a cost perspective, FKTIX is actually cheaper than its peers.
Investors should also note, that according to our data, the fund does not have any minimum investment requirements.
Fees charged by investment advisors have not been taken into considiration. Returns would be less if those were included.
Bottom Line
Overall, even with its comparatively similar performance, better downside risk, and lower fees, Franklin Federal Tax-Free Inc A1 ( FKTIX ) has a low Zacks Mutual Fund rank, and therefore looks a somewhat weak choice for investors right now.
Don't stop here for your research on Mutual Fund Bond funds. We also have plenty more on our site in order to help you find the best possible fund for your portfolio. Make sure to check out www.zacks.com/funds/mutual-funds for more information about the world of funds, and feel free to compare FKTIX to its peers as well for additional information. And don't forget, Zacks has all of your needs covered on the equity side too! Make sure to check out Zacks.com for more information on our screening capabilities, Rank, and all our articles as well.