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Is PONAX a Strong Bond Fund Right Now?

Looking for a Diversified Bonds fund? You may want to consider PIMCO Income A PONAX as a possible option. PONAX possesses a Zacks Mutual Fund Rank of 3 (Hold), which is based on nine forecasting factors like size, cost, and past performance.

Objective

We classify PONAX in the Diversified Bonds category, an area that is rife with potential choices. Diversified Bonds funds offer exposure to a wide variety of fixed income types, stretching across various issuers, credit levels, and maturities. Generally speaking, bond funds here will have sizable exposure to government debt, as well as modest holdings in the corporate bond market too.

History of Fund/Manager

PIMCO Funds is based in Newport Beach, CA, and is the manager of PONAX. PIMCO Income A made its debut in April of 2007, and since then, PONAX has accumulated about $22.53 billion in assets, per the most up-to-date date available. The fund is currently managed by Daniel J. Ivascyn who has been in charge of the fund since April of 2007.

Performance

Of course, investors look for strong performance in funds. PONAX has a 5-year annualized total return of 5.13% 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 4.62%, 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. PONAX's standard deviation over the past three years is 2.27% compared to the category average of 7.78%. The fund's standard deviation over the past 5 years is 2.54% compared to the category average of 7.61%. This makes the fund less volatile than its peers over the past half-decade.

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, PONAX is a load fund. It has an expense ratio of 0.88% compared to the category average of 0.91%. Looking at the fund from a cost perspective, PONAX is actually cheaper than its peers.

This fund requires a minimum initial investment of $1,000, and each subsequent investment should be at least $50.

Bottom Line

Overall, PIMCO Income A has a neutral Zacks Mutual Fund rank, and in conjunction with its comparatively strong performance, better downside risk, and lower fees, this fund looks like a somewhat average choice for investors right now.

This could just be the start of your research on PONAX in the Diversified Bonds 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. Zacks provides a full suite of tools to help you analyze your portfolio - both funds and stocks - in the most efficient way possible.

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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.


The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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