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Having trouble finding a Diversified Bonds fund? Well, Metropolitan West Total Retail Bond Plan (MWTSX - Free Report) would not be a good potential starting point right now. MWTSX possesses a Zacks Mutual Fund Rank of 5 (Strong Sell), which is based on various forecasting factors like size, cost, and past performance.
Objective
We classify MWTSX 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
MWTSX finds itself in the TCW family, based out of Los Angeles, CA. Since Metropolitan West Total Retail Bond Plan made its debut in August of 2011, MWTSX has garnered more than $9.18 billion in assets. A team of investment professionals is the fund's current manager.
Performance
Investors naturally seek funds with strong performance. This fund in particular has delivered a 5-year annualized total return of -0.67%, and it sits in the bottom third among its category peers. If you're interested in shorter time frames, do not dismiss looking at the fund's 3 -year annualized total return of 2.65%, 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 12.53%, the standard deviation of MWTSX over the past three years is 8.33%. The fund's standard deviation over the past 5 years is 7.09% compared to the category average of 11.97%. This makes the fund less volatile than its peers over the past half-decade.
Bond Duration
Modified duration is a measure of a specific bond's interest rate sensitivity, and is an excellent way to judge how fixed income securities will respond to a shifting rate environment.
For those that believe interest rates will rise, this is an important factor to consider. MWTSX has a modified duration of 6.73, which suggests that the fund will decline 6.73% for every hundred-basis-point increase in interest rates.
This fund has a beta of 1.15, meaning that it is more volatile than a broad market index of fixed income securities. Taking this into account, MWTSX has a positive alpha of 0.53, 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, MWTSX has 78.21% 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
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, MWTSX is a no load fund. It has an expense ratio of 0.37% compared to the category average of 0.89%. From a cost perspective, MWTSX is actually cheaper than its peers.
Investors should also note that the minimum initial investment for the product is $25 million and that each subsequent investment needs to be at $50,000
Fees charged by investment advisors have not been taken into considiration. Returns would be less if those were included.
Bottom Line
Overall, even with its comparatively weak performance, average downside risk, and lower fees, Metropolitan West Total Retail Bond Plan ( MWTSX ) has a low Zacks Mutual Fund rank, and therefore looks a somewhat weak choice for investors right now.
For additional information on the Diversified Bonds area of the mutual fund world, make sure to check out www.zacks.com/funds/mutual-funds. There, you can see more about the ranking process, and dive even deeper into MWTSX too for additional information. If you want to check out our stock reports as well, make sure to go to Zacks.com to see all of the great tools we have to offer, including our time-tested Zacks Rank.
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Is MWTSX a Strong Bond Fund Right Now?
Having trouble finding a Diversified Bonds fund? Well, Metropolitan West Total Retail Bond Plan (MWTSX - Free Report) would not be a good potential starting point right now. MWTSX possesses a Zacks Mutual Fund Rank of 5 (Strong Sell), which is based on various forecasting factors like size, cost, and past performance.
Objective
We classify MWTSX 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
MWTSX finds itself in the TCW family, based out of Los Angeles, CA. Since Metropolitan West Total Retail Bond Plan made its debut in August of 2011, MWTSX has garnered more than $9.18 billion in assets. A team of investment professionals is the fund's current manager.
Performance
Investors naturally seek funds with strong performance. This fund in particular has delivered a 5-year annualized total return of -0.67%, and it sits in the bottom third among its category peers. If you're interested in shorter time frames, do not dismiss looking at the fund's 3 -year annualized total return of 2.65%, 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 12.53%, the standard deviation of MWTSX over the past three years is 8.33%. The fund's standard deviation over the past 5 years is 7.09% compared to the category average of 11.97%. This makes the fund less volatile than its peers over the past half-decade.
Bond Duration
Modified duration is a measure of a specific bond's interest rate sensitivity, and is an excellent way to judge how fixed income securities will respond to a shifting rate environment.
For those that believe interest rates will rise, this is an important factor to consider. MWTSX has a modified duration of 6.73, which suggests that the fund will decline 6.73% for every hundred-basis-point increase in interest rates.
This fund has a beta of 1.15, meaning that it is more volatile than a broad market index of fixed income securities. Taking this into account, MWTSX has a positive alpha of 0.53, 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, MWTSX has 78.21% 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
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, MWTSX is a no load fund. It has an expense ratio of 0.37% compared to the category average of 0.89%. From a cost perspective, MWTSX is actually cheaper than its peers.
Investors should also note that the minimum initial investment for the product is $25 million and that each subsequent investment needs to be at $50,000
Fees charged by investment advisors have not been taken into considiration. Returns would be less if those were included.
Bottom Line
Overall, even with its comparatively weak performance, average downside risk, and lower fees, Metropolitan West Total Retail Bond Plan ( MWTSX ) has a low Zacks Mutual Fund rank, and therefore looks a somewhat weak choice for investors right now.
For additional information on the Diversified Bonds area of the mutual fund world, make sure to check out www.zacks.com/funds/mutual-funds. There, you can see more about the ranking process, and dive even deeper into MWTSX too for additional information. If you want to check out our stock reports as well, make sure to go to Zacks.com to see all of the great tools we have to offer, including our time-tested Zacks Rank.