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Is DLTNX a Strong Bond Fund Right Now?

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Having trouble finding a Government Mortgage - Intermediate fund? Well, DoubleLine Total Return Bond N (DLTNX - Free Report) would not be a good potential starting point right now. DLTNX carries a Zacks Mutual Fund Rank of 4 (Sell), which is based on nine forecasting factors like size, cost, and past performance.

Objective

The world of Government Mortgage - Intermediate funds is an area filled with choices, such as DLTNX. A mortgage-backed security (MBS) is a type of asset-backed security that packages mortgages together and then sells off the pooled securities. Government Mortgage - Intermediate funds focus on this market; this fund category presents a medium risk and yield profile, and concentrates on MBS with at least three years to maturity but less than 10.

History of Fund/Manager

Double Line is responsible for DLTNX, and the company is based out of Los Angeles, CA. The DoubleLine Total Return Bond N made its debut in April of 2010 and DLTNX has managed to accumulate roughly $6.02 billion in assets, as of the most recently available information. The fund is currently managed by a team of investment professionals.

Performance

Investors naturally seek funds with strong performance. This fund has delivered a 5-year annualized total return of 3.14%, and is in the bottom 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 3.31%, 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 9.21%, the standard deviation of DLTNX over the past three years is 3.4%. Looking at the past 5 years, the fund's standard deviation is 2.89% compared to the category average of 8.06%. This makes the fund less volatile than its peers over the past half-decade.

This fund has a beta of 0.81, meaning that it is less volatile than a broad market index of fixed income securities. Taking this into account, DLTNX has a negative alpha of -0.31, 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, DLTNX has 67.73% in high quality bonds rated at least 'AA' or higher. The fund has an average quality of AA, 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, DLTNX is a no load fund. It has an expense ratio of 0.73% compared to the category average of 0.82%. DLTNX is actually cheaper than its peers when you consider factors like cost.

This fund requires a minimum initial investment of $2,000, and each subsequent investment should be at least $100.

Bottom Line

Overall, DoubleLine Total Return Bond N ( DLTNX ) has a low Zacks Mutual Fund rank, and in conjunction with its comparatively weak performance, better downside risk, and lower fees, this fund looks like a somewhat weak choice for investors right now.

Don't stop here for your research on Government Mortgage - Intermediate 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 DLTNX to its peers as well 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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