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If investors are looking at the Diversified Bonds fund category, PIMCO Income A (PONAX - Free Report) could be a potential option. PONAX bears a Zacks Mutual Fund Rank of 1 (Strong Buy), which is based on nine forecasting factors like size, cost, and past performance.
Objective
PONAX 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
PIMCO Funds is based in Newport Beach, CA, and is the manager of PONAX. PIMCO Income A debuted in April of 2007. Since then, PONAX has accumulated assets of about $17.03 billion, according to the most recently available information. The fund's current manager is a team of investment professionals.
Performance
Investors naturally seek funds with strong performance. This fund has delivered a 5-year annualized total return of 5.61%, and it sits in the top 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 4.19%, 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. The standard deviation of PONAX over the past three years is 5.76% compared to the category average of 13.71%. The standard deviation of the fund over the past 5 years is 4.6% compared to the category average of 11.58%. This makes the fund less volatile than its peers over the past half-decade.
This fund has a beta of 0.4, meaning that it is less volatile than a broad market index of fixed income securities. Taking this into account, PONAX has a positive alpha of 3.36, 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, PONAX has 24.14% in high quality bonds rated at least 'AA' or higher, while 37.14% are of medium quality, with ratings of 'A' to 'BBB'. The fund's junk bond component-bonds rated 'BB' or below-is at 35.04%, giving PONAX an average quality of BBB. This means that it focuses on medium 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, PONAX is a load fund. It has an expense ratio of 0.91% compared to the category average of 0.88%. So, PONAX is actually more expensive than its peers from a cost perspective.
Investors should also note that the minimum initial investment for the product is $1,000 and that each subsequent investment needs to be at $50.
Bottom Line
Overall, PIMCO Income A ( PONAX ) has a high Zacks Mutual Fund rank, and in conjunction with its comparatively strong performance, better downside risk, and higher fees, PIMCO Income A ( PONAX ) looks like a good potential choice for investors right now.
This could just be the start of your research on PONAXin 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 PONAX a Strong Bond Fund Right Now?
If investors are looking at the Diversified Bonds fund category, PIMCO Income A (PONAX - Free Report) could be a potential option. PONAX bears a Zacks Mutual Fund Rank of 1 (Strong Buy), which is based on nine forecasting factors like size, cost, and past performance.
Objective
PONAX 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
PIMCO Funds is based in Newport Beach, CA, and is the manager of PONAX. PIMCO Income A debuted in April of 2007. Since then, PONAX has accumulated assets of about $17.03 billion, according to the most recently available information. The fund's current manager is a team of investment professionals.
Performance
Investors naturally seek funds with strong performance. This fund has delivered a 5-year annualized total return of 5.61%, and it sits in the top 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 4.19%, 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. The standard deviation of PONAX over the past three years is 5.76% compared to the category average of 13.71%. The standard deviation of the fund over the past 5 years is 4.6% compared to the category average of 11.58%. This makes the fund less volatile than its peers over the past half-decade.
This fund has a beta of 0.4, meaning that it is less volatile than a broad market index of fixed income securities. Taking this into account, PONAX has a positive alpha of 3.36, 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, PONAX has 24.14% in high quality bonds rated at least 'AA' or higher, while 37.14% are of medium quality, with ratings of 'A' to 'BBB'. The fund's junk bond component-bonds rated 'BB' or below-is at 35.04%, giving PONAX an average quality of BBB. This means that it focuses on medium 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, PONAX is a load fund. It has an expense ratio of 0.91% compared to the category average of 0.88%. So, PONAX is actually more expensive than its peers from a cost perspective.
Investors should also note that the minimum initial investment for the product is $1,000 and that each subsequent investment needs to be at $50.
Bottom Line
Overall, PIMCO Income A ( PONAX ) has a high Zacks Mutual Fund rank, and in conjunction with its comparatively strong performance, better downside risk, and higher fees, PIMCO Income A ( PONAX ) looks like a good potential choice for investors right now.
This could just be the start of your research on PONAXin 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.