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Having trouble finding an Investment Grade Bond - Intermediate fund? Principal Spectrum Preferred and Capital Securities Income A (PPSAX - Free Report) is a possible starting point. PPSAX carries a Zacks Mutual Fund Rank of 3 (Hold), which is based on various forecasting factors like size, cost, and past performance.
Objective
We note that PPSAX is an Investment Grade Bond - Intermediate option, which is a segment loaded with many different investment options. By targeting bonds that mature in more than three years but less than 15 years, Investment Grade Bond - Intermediate funds are a middle of the curve option. Fixed income instruments at this maturity level usually have medium duration risk, but their yields are respectable, especially in comparison to their short-maturity counterparts. Additionally, a focus on investment grade makes these funds safer, but yields tend to be lower than in the junk bond category.
History of Fund/Manager
Principal Financial Group is based in Des Moines, IA, and is the manager of PPSAX. The Principal Spectrum Preferred and Capital Securities Income A made its debut in October of 2005 and PPSAX has managed to accumulate roughly $635.53 million in assets, as of the most recently available information. A team of investment professionals is the fund's current manager.
Performance
Investors naturally seek funds with strong performance. PPSAX has a 5-year annualized total return of 3.66% and it sits in the bottom 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 5%, 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. Compared to the category average of 13.18%, the standard deviation of PPSAX over the past three years is 7.57%. Looking at the past 5 years, the fund's standard deviation is 6.65% compared to the category average of 12.8%. This makes the fund less volatile than its peers over the past half-decade.
With a beta of 0.16, this fund is less volatile than a broad market index of fixed income securities. Taking this into account, PPSAX has a positive alpha of 3.46, which measures performance on a risk-adjusted basis.
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, PPSAX is a load fund. It has an expense ratio of 1.05% compared to the category average of 0.97%. From a cost perspective, PPSAX is actually more expensive than its peers.
Investors should also note that the minimum initial investment for the product is $1,000 and that each subsequent investment needs to be at $100
Fees charged by investment advisors have not been taken into considiration. Returns would be less if those were included.
Bottom Line
Overall, even with its comparatively weak performance, better downside risk, and higher fees, Principal Spectrum Preferred and Capital Securities Income A ( PPSAX ) has a neutral Zacks Mutual Fund rank, and therefore looks a somewhat average choice for investors right now.
Don't stop here for your research on Investment Grade Bond - 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 PPSAX to its peers as well for additional information. If you want to check out our stock reports as well, make sure to go to Zacks.com to see all of the great tools we have to offer, including our time-tested Zacks Rank.
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Is PPSAX a Strong Bond Fund Right Now?
Having trouble finding an Investment Grade Bond - Intermediate fund? Principal Spectrum Preferred and Capital Securities Income A (PPSAX - Free Report) is a possible starting point. PPSAX carries a Zacks Mutual Fund Rank of 3 (Hold), which is based on various forecasting factors like size, cost, and past performance.
Objective
We note that PPSAX is an Investment Grade Bond - Intermediate option, which is a segment loaded with many different investment options. By targeting bonds that mature in more than three years but less than 15 years, Investment Grade Bond - Intermediate funds are a middle of the curve option. Fixed income instruments at this maturity level usually have medium duration risk, but their yields are respectable, especially in comparison to their short-maturity counterparts. Additionally, a focus on investment grade makes these funds safer, but yields tend to be lower than in the junk bond category.
History of Fund/Manager
Principal Financial Group is based in Des Moines, IA, and is the manager of PPSAX. The Principal Spectrum Preferred and Capital Securities Income A made its debut in October of 2005 and PPSAX has managed to accumulate roughly $635.53 million in assets, as of the most recently available information. A team of investment professionals is the fund's current manager.
Performance
Investors naturally seek funds with strong performance. PPSAX has a 5-year annualized total return of 3.66% and it sits in the bottom 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 5%, 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. Compared to the category average of 13.18%, the standard deviation of PPSAX over the past three years is 7.57%. Looking at the past 5 years, the fund's standard deviation is 6.65% compared to the category average of 12.8%. This makes the fund less volatile than its peers over the past half-decade.
With a beta of 0.16, this fund is less volatile than a broad market index of fixed income securities. Taking this into account, PPSAX has a positive alpha of 3.46, which measures performance on a risk-adjusted basis.
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, PPSAX is a load fund. It has an expense ratio of 1.05% compared to the category average of 0.97%. From a cost perspective, PPSAX is actually more expensive than its peers.
Investors should also note that the minimum initial investment for the product is $1,000 and that each subsequent investment needs to be at $100
Fees charged by investment advisors have not been taken into considiration. Returns would be less if those were included.
Bottom Line
Overall, even with its comparatively weak performance, better downside risk, and higher fees, Principal Spectrum Preferred and Capital Securities Income A ( PPSAX ) has a neutral Zacks Mutual Fund rank, and therefore looks a somewhat average choice for investors right now.
Don't stop here for your research on Investment Grade Bond - 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 PPSAX to its peers as well for additional information. If you want to check out our stock reports as well, make sure to go to Zacks.com to see all of the great tools we have to offer, including our time-tested Zacks Rank.