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On the lookout for a High Yield - Bonds fund? Starting with PGIM High Yield Z (PHYZX - Free Report) is one possibility. PHYZX carries a Zacks Mutual Fund Rank of 1 (Strong Buy), which is based on nine forecasting factors like size, cost, and past performance.
Objective
PHYZX is part of the High Yield - Bonds section, which is a segment that boasts many possible options. Often referred to as " junk " bonds, High Yield - Bonds funds sit below investment grade, meaning they are at a high default risk compared to their investment grade peers. However, one advantage to junk bonds is that they generally pay out higher yields while posing similar interest rate risks to their investment grade counterparts.
History of Fund/Manager
PGIM is based in Providence, RI, and is the manager of PHYZX. Since PGIM High Yield Z made its debut in March of 1996, PHYZX has garnered more than $9.24 billion in assets. The fund's current manager is a team of investment professionals.
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 7.53%, 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 7.49%, which places it in the top 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. PHYZX's standard deviation over the past three years is 9.9% compared to the category average of 14.13%. Looking at the past 5 years, the fund's standard deviation is 7.88% compared to the category average of 11.72%. This makes the fund less volatile than its peers over the past half-decade.
With a beta of 0.56, this fund is less volatile than a broad market index of fixed income securities. Taking this into account, PHYZX has a positive alpha of 5.5, 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, PHYZX 's junk bond component-bonds rated 'BB' or below-is at 88.61%. This means that the fund has an average quality of BBB, and 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, PHYZX is a no load fund. It has an expense ratio of 0.53% compared to the category average of 1%. So, PHYZX is actually cheaper than its peers from a cost perspective.
This fund requires a minimum initial investment of $0, while there is no minimum for each subsequent investment.
Bottom Line
Overall, PGIM High Yield Z ( PHYZX ) has a high Zacks Mutual Fund rank, and in conjunction with its comparatively strong performance, average downside risk, and lower fees, this fund looks like a good potential choice for investors right now.
For additional information on this product, or to compare it to other mutual funds in the High Yield - Bonds, make sure to go to www.zacks.com/funds/mutual-funds 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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Is PHYZX a Strong Bond Fund Right Now?
On the lookout for a High Yield - Bonds fund? Starting with PGIM High Yield Z (PHYZX - Free Report) is one possibility. PHYZX carries a Zacks Mutual Fund Rank of 1 (Strong Buy), which is based on nine forecasting factors like size, cost, and past performance.
Objective
PHYZX is part of the High Yield - Bonds section, which is a segment that boasts many possible options. Often referred to as " junk " bonds, High Yield - Bonds funds sit below investment grade, meaning they are at a high default risk compared to their investment grade peers. However, one advantage to junk bonds is that they generally pay out higher yields while posing similar interest rate risks to their investment grade counterparts.
History of Fund/Manager
PGIM is based in Providence, RI, and is the manager of PHYZX. Since PGIM High Yield Z made its debut in March of 1996, PHYZX has garnered more than $9.24 billion in assets. The fund's current manager is a team of investment professionals.
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 7.53%, 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 7.49%, which places it in the top 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. PHYZX's standard deviation over the past three years is 9.9% compared to the category average of 14.13%. Looking at the past 5 years, the fund's standard deviation is 7.88% compared to the category average of 11.72%. This makes the fund less volatile than its peers over the past half-decade.
With a beta of 0.56, this fund is less volatile than a broad market index of fixed income securities. Taking this into account, PHYZX has a positive alpha of 5.5, 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, PHYZX 's junk bond component-bonds rated 'BB' or below-is at 88.61%. This means that the fund has an average quality of BBB, and 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, PHYZX is a no load fund. It has an expense ratio of 0.53% compared to the category average of 1%. So, PHYZX is actually cheaper than its peers from a cost perspective.
This fund requires a minimum initial investment of $0, while there is no minimum for each subsequent investment.
Bottom Line
Overall, PGIM High Yield Z ( PHYZX ) has a high Zacks Mutual Fund rank, and in conjunction with its comparatively strong performance, average downside risk, and lower fees, this fund looks like a good potential choice for investors right now.
For additional information on this product, or to compare it to other mutual funds in the High Yield - Bonds, make sure to go to www.zacks.com/funds/mutual-funds 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.