Yahoo Finance Is CPHYX a Strong Bond Fund Right Now?
If investors are looking at the High Yield - Bonds fund category, Principal High Yield A (CPHYX) could be a potential option. CPHYX holds a Zacks Mutual Fund Rank of 2 (Buy), which is based on various forecasting factors like size, cost, and past performance.
Objective
CPHYX is part of the High Yield - Bonds section, which is a segment that boasts many possible options. Often referred to as " junk " bonds, High Yield - Bonds funds sit below investment grade, meaning they are at a high default risk compared to their investment grade peers. However, one advantage to junk bonds is that they generally pay out higher yields while posing similar interest rate risks to their investment grade counterparts.
History of Fund/Manager
CPHYX finds itself in the Principal Financial Group family, based out of Des Moines, IA. Principal High Yield A debuted in April of 1998. Since then, CPHYX has accumulated assets of about $414.84 million, according to the most recently available information. A team of investment professionals is the fund's current manager.
Performance
Obviously, what investors are looking for in these funds is strong performance relative to their peers. This fund has delivered a 5-year annualized total return of 3.78%, and is in the top 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 2.21%, 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. Over the past three years, CPHYX's standard deviation comes in at 7.68%, compared to the category average of 12.53%. The fund's standard deviation over the past 5 years is 8.57% compared to the category average of 13.64%. This makes the fund less volatile than its peers over the past half-decade.
This fund has a beta of 0.23, 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 3.69, 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 0.94% compared to the category average of 0.94%. From a cost perspective, CPHYX is actually on par with its peers.
Investors should also note that the minimum initial investment for the product is $1,000 and that each subsequent investment needs to be at $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 on par fees, Principal High Yield A ( CPHYX ) looks like a good potential choice for investors right now.
Don't stop here for your research on High Yield - Bonds funds. We also have plenty more on our site in order to help you find the best possible fund for your portfolio. Make sure to check out www.zacks.com/funds/mutual-funds for more information about the world of funds, and feel free to compare CPHYX to its peers 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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