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Is ECMMX a Strong Bond Fund Right Now?

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If you've been stuck searching for Muni - Bonds funds, you might want to consider passing on by Eaton Vance MA Municipals C (ECMMX - Free Report) as a possibility. ECMMX bears a Zacks Mutual Fund Rank of 5 (Strong Sell), which is based on various forecasting factors like size, cost, and past performance.

Objective

Zacks categorizes ECMMX 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

Eaton Vance is based in Boston, MA, and is the manager of ECMMX. Eaton Vance MA Municipals C debuted in July of 2006. Since then, ECMMX has accumulated assets of about $1.52 million, according to the most recently available information. The fund is currently managed by Craig Brandon who has been in charge of the fund since February of 2010.

Performance

Investors naturally seek funds with strong performance. This fund has delivered a 5-year annualized total return of -0.28%, and is in the bottom third among its category peers. Investors who prefer analyzing shorter time frames should look at its 3-year annualized total return of -1.49%, which places it in the bottom 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 11.92%, the standard deviation of ECMMX over the past three years is 7.67%. Over the past 5 years, the standard deviation of the fund is 6.56% compared to the category average of 12.28%. This makes the fund less volatile than its peers over the past half-decade.

ECMMX carries a beta of 0.8, meaning that the fund is less volatile than a broad market index of fixed income securities. With this in mind, it has a negative alpha of -1.58, 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, ECMMX has 69.7% in high quality bonds rated at least 'AA' or higher, while 23.9% are of medium quality, with ratings of 'A' to 'BBB'. The fund has an average quality of AA, and focuses on high quality securities.

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, ECMMX is a no load fund. It has an expense ratio of 1.47% compared to the category average of 0.85%. From a cost perspective, ECMMX is actually more expensive than its peers.

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, Eaton Vance MA Municipals C ( ECMMX ) has a low Zacks Mutual Fund rank, and in conjunction with its comparatively weak performance, better downside risk, and higher fees, Eaton Vance MA Municipals C ( ECMMX ) looks like a somewhat weak choice for investors right now.

Want even more information about ECMMX? 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. 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.


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