Any investors hoping to find an Allocation Balanced fund could think about starting with Plumb Balanced (PLBBX). PLBBX carries a Zacks Mutual Fund Rank of 1 (Strong Buy), which is based on nine forecasting factors like size, cost, and past performance.
The world of Zacks' Allocation Balanced funds is an area filled with options, such as PLBBX. These funds like to invest in a variety of asset types, finding a balance between stocks, bonds, cash, and sometimes even precious metals and commodities; they are mostly categorized by their respective asset allocation. For investors, Allocation Balanced funds can provide an entry point into diversified mutual funds, and present core holding options for a portfolio of funds.
History of Fund/Manager
Wisconsin Cap is based in Madison, WI, and is the manager of PLBBX. Plumb Balanced made its debut in May of 2007, and since then, PLBBX has accumulated about $86.71 million in assets, per the most up-to-date date available. The fund's current manager, Thomas G. Plumb, has been in charge of the fund since May of 2007.
Investors naturally seek funds with strong performance. This fund in particular has delivered a 5-year annualized total return of 11.66%, 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 14.23%, 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, PLBBX's standard deviation comes in at 7.24%, compared to the category average of 6.89%. Looking at the past 5 years, the fund's standard deviation is 7.27% compared to the category average of 6.76%. This makes the fund more volatile than its peers over the past half-decade.
Investors cannot discount the risks to this segment though, as it is always important to remember the downside for any potential investment. In the most recent bear market, PLBBX lost 37.07% and outperformed its peer group by 0.93%. This might suggest that the fund is a better choice than its peers during a bear market.
Even still, the fund has a 5-year beta of 0.69, so investors should note that it is hypothetically less volatile than the market at large. Alpha is an additional metric to take into consideration, since it represents a portfolio's performance on a risk-adjusted basis relative to a benchmark, which in this case, is the S&P 500. PLBBX has generated a positive alpha over the past five years of 1.83, demonstrating that managers in this portfolio are skilled in picking securities that generate better-than-benchmark returns.
Examining the equity holdings of a mutual fund is also a valuable exercise. This can show us how the manager is applying their stated methodology, as well as if there are any inherent biases in their approach. For this particular fund, the focus is principally on equities that are traded in the United States.
The mutual fund currently has 86.59% of its holdings in stocks, which have an average market capitalization of $168.35 billion. The fund has the heaviest exposure to the following market sectors:
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, PLBBX is a no load fund. It has an expense ratio of 1.26% compared to the category average of 0.89%. From a cost perspective, PLBBX is actually more expensive than its peers.
While the minimum initial investment for the product is $2,500, investors should also note that each subsequent investment needs to be at least $100.
Overall, Plumb Balanced ( PLBBX ) has a high Zacks Mutual Fund rank, and in conjunction with its comparatively strong performance, average downside risk, and higher fees, Plumb Balanced ( PLBBX ) looks like a good potential choice for investors right now.
Your research on the Allocation Balanced 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. If you are more of a stock investor, make sure to also check out our Zacks Rank, and our full suite of tools we have available for novice and professional investors alike.
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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.