Back to top

Image: Bigstock

Is PCRAX a Strong Bond Fund Right Now?

Read MoreHide Full Article

Any investors hoping to find a Mutual Fund Bond fund could think about starting with PIMCO Commodity Real Retail Strategy A (PCRAX - Free Report) . PCRAX bears a Zacks Mutual Fund Rank of 2 (Buy), which is based on nine forecasting factors like size, cost, and past performance.

History of Fund/Manager

PCRAX finds itself in the PIMCO Funds family, based out of Newport Beach, CA. Since PIMCO Commodity Real Retail Strategy A made its debut in June of 2002, PCRAX has garnered more than $471.43 million in assets. A team of investment professionals is the fund's current manager.

Performance

Investors naturally seek funds with strong performance. PCRAX has a 5-year annualized total return of 9.85% and is 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 16.32%, 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. Over the past three years, PCRAX's standard deviation comes in at 20.89%, compared to the category average of 15.4%. The standard deviation of the fund over the past 5 years is 17.53% compared to the category average of 13.69%. This makes the fund more volatile than its peers over the past half-decade.

With a beta of -1.66, this fund is less volatile than a broad market index of fixed income securities. Taking this into account, PCRAX has a positive alpha of 10.32, 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, PCRAX has 97.67% in high quality bonds rated at least 'AA' or higher. The fund has an average quality of AAA, and focuses on high 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, PCRAX is a load fund. It has an expense ratio of 1.18% compared to the category average of 0.83%. From a cost perspective, PCRAX is actually more expensive than its peers.

Investors need to be aware that with this product, the minimum initial investment is $1,000; each subsequent investment needs to be at least $50.

Bottom Line

Overall, PIMCO Commodity Real Retail Strategy A ( PCRAX ) has a high Zacks Mutual Fund rank, and in conjunction with its comparatively strong performance, average downside risk, and higher fees, PIMCO Commodity Real Retail Strategy A ( PCRAX ) looks like a good potential choice for investors right now.

This could just be the start of your research on PCRAXin the Mutual Fund Bond 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. And don't forget, Zacks has all of your needs covered on the equity side too! Make sure to check out Zacks.com for more information on our screening capabilities, Rank, and all our articles as well.


See More Zacks Research for These Tickers


Normally $25 each - click below to receive one report FREE:


PIMCO Commodity Real Ret Str A (PCRAX) - free report >>

Published in