Is CPHYX a Strong Bond Fund Right Now?
Mutual Fund Bond fund seekers should consider taking a look at Principal High Yield A (CPHYX). CPHYX carries a Zacks Mutual Fund Rank of 2 (Buy), which is based on various forecasting factors like size, cost, and past performance.
History of Fund/Manager
CPHYX is a part of the Principal Financial Group family of funds, a company based out of Des Moines, IA. Principal High Yield A made its debut in April of 1998, and since then, CPHYX has accumulated about $406.43 million in assets, per the most up-to-date date available. The fund's current manager is a team of investment professionals.
Performance
Of course, investors look for strong performance in funds. CPHYX has a 5-year annualized total return of 2.9% and is in the top 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 1.72%, which places it in the top 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. The standard deviation of CPHYX over the past three years is 7.43% compared to the category average of 12.78%. Over the past 5 years, the standard deviation of the fund is 8.66% compared to the category average of 13.67%. This makes the fund less volatile than its peers over the past half-decade.
This fund has a beta of 0.24, meaning that it is less volatile than a broad market index of fixed income securities. Taking this into account, CPHYX has a positive alpha of 2.77, which measures performance on a risk-adjusted basis.
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, CPHYX is a load fund. It has an expense ratio of 0.92% compared to the category average of 0.95%. CPHYX is actually cheaper than its peers when you consider factors like cost.
Investors need to be aware that with this product, the minimum initial investment is $1,000; each subsequent investment needs to be at least $100.
Fees charged by investment advisors have not been taken into considiration. Returns would be less if those were included.
Bottom Line
Overall, Principal High Yield A ( CPHYX ) has a high Zacks Mutual Fund rank, and in conjunction with its comparatively strong performance, better downside risk, and lower fees, this fund looks like a good potential choice for investors right now.
Your research on the Mutual Fund Bond 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. Want to learn even more? We have a full suite of tools on stocks that you can use to find the best choices for your portfolio too, no matter what kind of investor you are.
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