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There are plenty of choices in the Muni - Bonds category, but where should you start your research? Well, one fund that might be worth investigating is Franklin California High Yield Municipals A (FCAMX - Free Report) . FCAMX possesses a Zacks Mutual Fund Rank of 1 (Strong Buy), which is based on various forecasting factors like size, cost, and past performance.
Objective
Zacks categorizes FCAMX as Muni - Bonds, which is a segment packed with options. Muni - Bonds funds invest in debt securities issued by states or local municipalities. These are generally used to finance construction of infrastructure, pay for schools, or other government functions. Some are backed by taxes (revenue bonds), while others are " general obligation " and may not be backed by a defined source. Investors usually appreciate the tax benefits that come with many municipal bonds, which are especially impressive for those in high tax brackets.
History of Fund/Manager
FCAMX is a part of the Franklin family of funds, a company based out of San Mateo, CA. Franklin California High Yield Municipals A debuted in May of 1993. Since then, FCAMX has accumulated assets of about $735.63 million, according to the most recently available information. The fund is currently managed by a team of investment professionals.
Performance
Of course, investors look for strong performance in funds. This fund in particular has delivered a 5-year annualized total return of 1.25%, 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 -0.62%, 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, FCAMX's standard deviation comes in at 8.76%, compared to the category average of 13.14%. Over the past 5 years, the standard deviation of the fund is 8.23% compared to the category average of 13.72%. This makes the fund less volatile than its peers over the past half-decade.
This fund has a beta of 0.88, meaning that it is less volatile than a broad market index of fixed income securities. Taking this into account, FCAMX has a positive alpha of 0.25, which measures performance on a risk-adjusted basis.
Ratings
However, it is worth noting that 48 % of the bonds in this fund are not ranked, so take the average quality level with a bit of caution.
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, FCAMX is a load fund. It has an expense ratio of 0.65% compared to the category average of 0.90%. FCAMX is actually cheaper than its peers when you consider factors like cost.
While the minimum initial investment for the product is $1,000, investors should also note that 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 California High Yield Municipals A ( FCAMX ) has a high Zacks Mutual Fund rank, and in conjunction with its comparatively similar performance, better downside risk, and lower fees, this fund looks like a good potential 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 FCAMX a Strong Bond Fund Right Now?
There are plenty of choices in the Muni - Bonds category, but where should you start your research? Well, one fund that might be worth investigating is Franklin California High Yield Municipals A (FCAMX - Free Report) . FCAMX possesses a Zacks Mutual Fund Rank of 1 (Strong Buy), which is based on various forecasting factors like size, cost, and past performance.
Objective
Zacks categorizes FCAMX as Muni - Bonds, which is a segment packed with options. Muni - Bonds funds invest in debt securities issued by states or local municipalities. These are generally used to finance construction of infrastructure, pay for schools, or other government functions. Some are backed by taxes (revenue bonds), while others are " general obligation " and may not be backed by a defined source. Investors usually appreciate the tax benefits that come with many municipal bonds, which are especially impressive for those in high tax brackets.
History of Fund/Manager
FCAMX is a part of the Franklin family of funds, a company based out of San Mateo, CA. Franklin California High Yield Municipals A debuted in May of 1993. Since then, FCAMX has accumulated assets of about $735.63 million, according to the most recently available information. The fund is currently managed by a team of investment professionals.
Performance
Of course, investors look for strong performance in funds. This fund in particular has delivered a 5-year annualized total return of 1.25%, 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 -0.62%, 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, FCAMX's standard deviation comes in at 8.76%, compared to the category average of 13.14%. Over the past 5 years, the standard deviation of the fund is 8.23% compared to the category average of 13.72%. This makes the fund less volatile than its peers over the past half-decade.
This fund has a beta of 0.88, meaning that it is less volatile than a broad market index of fixed income securities. Taking this into account, FCAMX has a positive alpha of 0.25, which measures performance on a risk-adjusted basis.
Ratings
However, it is worth noting that 48 % of the bonds in this fund are not ranked, so take the average quality level with a bit of caution.
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, FCAMX is a load fund. It has an expense ratio of 0.65% compared to the category average of 0.90%. FCAMX is actually cheaper than its peers when you consider factors like cost.
While the minimum initial investment for the product is $1,000, investors should also note that 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 California High Yield Municipals A ( FCAMX ) has a high Zacks Mutual Fund rank, and in conjunction with its comparatively similar performance, better downside risk, and lower fees, this fund looks like a good potential 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.