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There are plenty of choices in the Mutual Fund Bond category, but where should you start your research? Well, one fund that may not be worth investigating is PIMCO Total Return Institutional (PTTRX - Free Report) . PTTRX holds a Zacks Mutual Fund Rank of 5 (Strong Sell), which is based on various forecasting factors like size, cost, and past performance.
History of Fund/Manager
PIMCO Funds is based in Newport Beach, CA, and is the manager of PTTRX. Since PIMCO Total Return Institutional made its debut in May of 1987, PTTRX has garnered more than $44.36 billion in assets. The fund is currently managed by a team of investment professionals.
Performance
Obviously, what investors are looking for in these funds is strong performance relative to their peers. This fund carries a 5-year annualized total return of 1.15%, and is 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 -2.68%, which places it in the bottom 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. The standard deviation of PTTRX over the past three years is 6.32% compared to the category average of 14.06%. The fund's standard deviation over the past 5 years is 5.52% compared to the category average of 13.83%. This makes the fund less volatile than its peers over the past half-decade.
With a beta of 0.99, this fund is less volatile than a broad market index of fixed income securities. Taking this into account, PTTRX has a negative alpha of -0.02, 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, PTTRX has 69.8% in high quality bonds rated at least 'AA' or higher. The fund has an average quality of AA, 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, PTTRX is a no load fund. It has an expense ratio of 0.46% compared to the category average of 0.75%. Looking at the fund from a cost perspective, PTTRX is actually cheaper than its peers.
Investors need to be aware that with this product, the minimum initial investment is $1 million; each subsequent investment has no minimum amount.
Bottom Line
Overall, PIMCO Total Return Institutional ( PTTRX ) has a low Zacks Mutual Fund rank, and in conjunction with its comparatively similar performance, better downside risk, and lower fees, this fund looks like a somewhat weak choice for investors right now.
Want even more information about PTTRX? Then go over to Zacks.com and check out our mutual fund comparison tool, and all of the other great features that we have to help you with your mutual fund analysis 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 PTTRX a Strong Bond Fund Right Now?
There are plenty of choices in the Mutual Fund Bond category, but where should you start your research? Well, one fund that may not be worth investigating is PIMCO Total Return Institutional (PTTRX - Free Report) . PTTRX holds a Zacks Mutual Fund Rank of 5 (Strong Sell), which is based on various forecasting factors like size, cost, and past performance.
History of Fund/Manager
PIMCO Funds is based in Newport Beach, CA, and is the manager of PTTRX. Since PIMCO Total Return Institutional made its debut in May of 1987, PTTRX has garnered more than $44.36 billion in assets. The fund is currently managed by a team of investment professionals.
Performance
Obviously, what investors are looking for in these funds is strong performance relative to their peers. This fund carries a 5-year annualized total return of 1.15%, and is 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 -2.68%, which places it in the bottom 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. The standard deviation of PTTRX over the past three years is 6.32% compared to the category average of 14.06%. The fund's standard deviation over the past 5 years is 5.52% compared to the category average of 13.83%. This makes the fund less volatile than its peers over the past half-decade.
With a beta of 0.99, this fund is less volatile than a broad market index of fixed income securities. Taking this into account, PTTRX has a negative alpha of -0.02, 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, PTTRX has 69.8% in high quality bonds rated at least 'AA' or higher. The fund has an average quality of AA, 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, PTTRX is a no load fund. It has an expense ratio of 0.46% compared to the category average of 0.75%. Looking at the fund from a cost perspective, PTTRX is actually cheaper than its peers.
Investors need to be aware that with this product, the minimum initial investment is $1 million; each subsequent investment has no minimum amount.
Bottom Line
Overall, PIMCO Total Return Institutional ( PTTRX ) has a low Zacks Mutual Fund rank, and in conjunction with its comparatively similar performance, better downside risk, and lower fees, this fund looks like a somewhat weak choice for investors right now.
Want even more information about PTTRX? Then go over to Zacks.com and check out our mutual fund comparison tool, and all of the other great features that we have to help you with your mutual fund analysis 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.