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If you have been looking for Diversified Bonds funds, it would not be wise to start your search with Putnam Diversified Income A (PDINX - Free Report) . PDINX holds a Zacks Mutual Fund Rank of 4 (Sell), which is based on various forecasting factors like size, cost, and past performance.
Objective
PDINX is one of many Diversified Bonds funds to choose from. Diversified Bonds funds give investors exposure to a variety of fixed income types that span across different issuers, maturities, and credit levels. Usually, these funds will have a good amount of exposure to government debt, in addition to modest holdings in the corporate bond market.
History of Fund/Manager
Putnam Funds is based in Canton, MA, and is the manager of PDINX. The Putnam Diversified Income A made its debut in October of 1988 and PDINX has managed to accumulate roughly $517.05 million in assets, as of the most recently available information. A team of investment professionals is the fund's current manager.
Performance
Of course, investors look for strong performance in funds. This fund has delivered a 5-year annualized total return of -0.2%, and is in the bottom 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 -2.36%, which places it in the bottom 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. PDINX's standard deviation over the past three years is 5.1% compared to the category average of 12.86%. Looking at the past 5 years, the fund's standard deviation is 7.84% compared to the category average of 13.89%. This makes the fund less volatile than its peers over the past half-decade.
With a beta of 0.34, this fund is less volatile than a broad market index of fixed income securities. Taking this into account, PDINX has a negative alpha of -0.86, 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 50.04% in high quality bonds rated at least 'AA' or higher, while its junk bond component-bonds rated 'BB' or below-is at 27.46%. This means that 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, PDINX is a load fund. It has an expense ratio of 1.04% compared to the category average of 1%. So, PDINX is actually more expensive 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.
Fees charged by investment advisors have not been taken into considiration. Returns would be less if those were included.
Bottom Line
Overall, Putnam Diversified Income A ( PDINX ) has a low Zacks Mutual Fund rank, and in conjunction with its comparatively weak performance, better downside risk, and higher fees, Putnam Diversified Income A ( PDINX ) looks like a somewhat weak choice for investors right now.
This could just be the start of your research on PDINXin the Diversified Bonds category. Consider going to www.zacks.com/funds/mutual-funds for additional information about this fund, and all the others that we rank as well for additional information. If you are more of a stock investor, make sure to also check out our Zacks Rank, and our full suite of tools we have available for novice and professional investors alike.
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Is PDINX a Strong Bond Fund Right Now?
If you have been looking for Diversified Bonds funds, it would not be wise to start your search with Putnam Diversified Income A (PDINX - Free Report) . PDINX holds a Zacks Mutual Fund Rank of 4 (Sell), which is based on various forecasting factors like size, cost, and past performance.
Objective
PDINX is one of many Diversified Bonds funds to choose from. Diversified Bonds funds give investors exposure to a variety of fixed income types that span across different issuers, maturities, and credit levels. Usually, these funds will have a good amount of exposure to government debt, in addition to modest holdings in the corporate bond market.
History of Fund/Manager
Putnam Funds is based in Canton, MA, and is the manager of PDINX. The Putnam Diversified Income A made its debut in October of 1988 and PDINX has managed to accumulate roughly $517.05 million in assets, as of the most recently available information. A team of investment professionals is the fund's current manager.
Performance
Of course, investors look for strong performance in funds. This fund has delivered a 5-year annualized total return of -0.2%, and is in the bottom 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 -2.36%, which places it in the bottom 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. PDINX's standard deviation over the past three years is 5.1% compared to the category average of 12.86%. Looking at the past 5 years, the fund's standard deviation is 7.84% compared to the category average of 13.89%. This makes the fund less volatile than its peers over the past half-decade.
With a beta of 0.34, this fund is less volatile than a broad market index of fixed income securities. Taking this into account, PDINX has a negative alpha of -0.86, 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 50.04% in high quality bonds rated at least 'AA' or higher, while its junk bond component-bonds rated 'BB' or below-is at 27.46%. This means that 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, PDINX is a load fund. It has an expense ratio of 1.04% compared to the category average of 1%. So, PDINX is actually more expensive 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.
Fees charged by investment advisors have not been taken into considiration. Returns would be less if those were included.
Bottom Line
Overall, Putnam Diversified Income A ( PDINX ) has a low Zacks Mutual Fund rank, and in conjunction with its comparatively weak performance, better downside risk, and higher fees, Putnam Diversified Income A ( PDINX ) looks like a somewhat weak choice for investors right now.
This could just be the start of your research on PDINXin the Diversified Bonds category. Consider going to www.zacks.com/funds/mutual-funds for additional information about this fund, and all the others that we rank as well for additional information. If you are more of a stock investor, make sure to also check out our Zacks Rank, and our full suite of tools we have available for novice and professional investors alike.