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On the lookout for an Investment Grade Bond - Intermediate fund? Starting with PIMCO Total Return A (PTTAX) should not be a possibility at this time. PTTAX possesses a Zacks Mutual Fund Rank of 4 (Sell), which is based on various forecasting factors like size, cost, and past performance.
Objective
PTTAX is one of many Investment Grade Bond - Intermediate funds to pick from. Investment Grade Bond - Intermediate funds focus on the middle part of the curve, generally with bonds that usually mature in more than three years but less than 15 years. Fixed income instruments with this maturity level usually have medium duration risk, but they also compensate investors with a modest yield, at least when compared to their short maturity counterparts. Additionally, the focus on investment grade will make funds here safer, but yields will be lower than in the junk bond category.
History of Fund/Manager
PIMCO Funds is based in Newport Beach, CA, and is the manager of PTTAX. PIMCO Total Return A debuted in May of 1987. Since then, PTTAX has accumulated assets of about $4.05 billion, according to the most recently available information. A team of investment professionals is the fund's current manager.
Performance
Of course, investors look for strong performance in funds. This fund in particular has delivered a 5-year annualized total return of -0.22%, and is in the middle third among its category peers. Investors who prefer analyzing shorter time frames should look at its 3-year annualized total return of 2.2%, which places it in the middle 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 13.2%, the standard deviation of PTTAX over the past three years is 7.5%. Over the past 5 years, the standard deviation of the fund is 6.5% compared to the category average of 13.93%. This makes the fund less volatile than its peers over the past half-decade.
This fund has a beta of 1, meaning that it is volatile than a broad market index of fixed income securities. Taking this into account, PTTAX has a positive alpha of 0.56, 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, PTTAX has 72.1% in high quality bonds rated at least 'AA' or higher, while 21.5% are of medium quality, with ratings of 'A' to 'BBB'. The fund has an average quality of AA, and focuses on high quality securities.