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Muni - Bonds fund seekers may want to consider taking a look at Franklin Arizona Tax-Free Income A (FTAZX - Free Report) . FTAZX bears a Zacks Mutual Fund Rank of 3 (Hold), which is based on various forecasting factors like size, cost, and past performance.
Objective
We classify FTAZX in the Muni - Bonds category, an area rife with potential choices. Muni - Bonds funds focus their investments on debt securities issued by state and local governments. These are typically used to pay for the construction of infrastructure, the operation of public schools, and other municipal functions. These securities can come in the form of revenue bonds, which are backed by taxes, as well as " general obligation " bonds that are not backed by a defined source. Investors are usually interested that come with most municipal bonds, which can be especially important for those in higher tax brackets.
History of Fund/Manager
Franklin is responsible for FTAZX, and the company is based out of San Mateo, CA. Franklin Arizona Tax-Free Income A made its debut in September of 1987, and since then, FTAZX has accumulated about $319.55 million in assets, per the most up-to-date date available. The fund is currently managed by a team of investment professionals.
Performance
Of course, investors look for strong performance in funds. This fund carries a 5-year annualized total return of 0.67%, 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 -0.58%, 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. Over the past three years, FTAZX's standard deviation comes in at 7.5%, compared to the category average of 13.05%. The fund's standard deviation over the past 5 years is 6.56% compared to the category average of 13.5%. This makes the fund less volatile than its peers over the past half-decade.
This fund has a beta of 0.79, meaning that it is less volatile than a broad market index of fixed income securities. Taking this into account, FTAZX has a negative alpha of -0.35, 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, FTAZX has 57.68% in high quality bonds rated at least 'AA' or higher, while 34.16% 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, FTAZX is a load fund. It has an expense ratio of 0.67% compared to the category average of 0.91%. FTAZX is actually cheaper than its peers when you consider factors like cost.
This fund requires a minimum initial investment of $1,000, while there is no minimum for each subsequent investment.
Fees charged by investment advisors have not been taken into considiration. Returns would be less if those were included.
Bottom Line
Overall, Franklin Arizona Tax-Free Income A ( FTAZX ) has a neutral Zacks Mutual Fund rank, and in conjunction with its comparatively similar performance, better downside risk, and lower fees, this fund looks like a somewhat average choice for investors right now.
Your research on the Muni - Bonds segment doesn't have to stop here. You can check out all the great mutual fund tools we have to offer by going to www.zacks.com/funds/mutual-funds to see the additional features we offer as well for additional information. For analysis of the rest of your portfolio, make sure to visit Zacks.com for our full suite of tools which will help you investigate all of your stocks and funds in one place.
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Is FTAZX a Strong Bond Fund Right Now?
Muni - Bonds fund seekers may want to consider taking a look at Franklin Arizona Tax-Free Income A (FTAZX - Free Report) . FTAZX bears a Zacks Mutual Fund Rank of 3 (Hold), which is based on various forecasting factors like size, cost, and past performance.
Objective
We classify FTAZX in the Muni - Bonds category, an area rife with potential choices. Muni - Bonds funds focus their investments on debt securities issued by state and local governments. These are typically used to pay for the construction of infrastructure, the operation of public schools, and other municipal functions. These securities can come in the form of revenue bonds, which are backed by taxes, as well as " general obligation " bonds that are not backed by a defined source. Investors are usually interested that come with most municipal bonds, which can be especially important for those in higher tax brackets.
History of Fund/Manager
Franklin is responsible for FTAZX, and the company is based out of San Mateo, CA. Franklin Arizona Tax-Free Income A made its debut in September of 1987, and since then, FTAZX has accumulated about $319.55 million in assets, per the most up-to-date date available. The fund is currently managed by a team of investment professionals.
Performance
Of course, investors look for strong performance in funds. This fund carries a 5-year annualized total return of 0.67%, 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 -0.58%, 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. Over the past three years, FTAZX's standard deviation comes in at 7.5%, compared to the category average of 13.05%. The fund's standard deviation over the past 5 years is 6.56% compared to the category average of 13.5%. This makes the fund less volatile than its peers over the past half-decade.
This fund has a beta of 0.79, meaning that it is less volatile than a broad market index of fixed income securities. Taking this into account, FTAZX has a negative alpha of -0.35, 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, FTAZX has 57.68% in high quality bonds rated at least 'AA' or higher, while 34.16% 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, FTAZX is a load fund. It has an expense ratio of 0.67% compared to the category average of 0.91%. FTAZX is actually cheaper than its peers when you consider factors like cost.
This fund requires a minimum initial investment of $1,000, while there is no minimum for each subsequent investment.
Fees charged by investment advisors have not been taken into considiration. Returns would be less if those were included.
Bottom Line
Overall, Franklin Arizona Tax-Free Income A ( FTAZX ) has a neutral Zacks Mutual Fund rank, and in conjunction with its comparatively similar performance, better downside risk, and lower fees, this fund looks like a somewhat average choice for investors right now.
Your research on the Muni - Bonds segment doesn't have to stop here. You can check out all the great mutual fund tools we have to offer by going to www.zacks.com/funds/mutual-funds to see the additional features we offer as well for additional information. For analysis of the rest of your portfolio, make sure to visit Zacks.com for our full suite of tools which will help you investigate all of your stocks and funds in one place.