Yahoo Finance Is MEMTX a Strong Bond Fund Right Now?
If investors are looking at the Mutual Fund Bond fund category, BlackRock Strategic Municipals Opportunities A (MEMTX) could be a potential option. MEMTX carries a Zacks Mutual Fund Rank of 2 (Buy), which is based on various forecasting factors like size, cost, and past performance.
History of Fund/Manager
BlackRock is based in New York, NY, and is the manager of MEMTX. BlackRock Strategic Municipals Opportunities A debuted in October of 2006. Since then, MEMTX has accumulated assets of about $967.70 million, according to the most recently available information. The fund is currently managed by a team of investment professionals.
Performance
Investors naturally seek funds with strong performance. This fund in particular has delivered a 5-year annualized total return of 0.43%, 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 1.86%, 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. MEMTX's standard deviation over the past three years is 7.1% compared to the category average of 13.39%. Over the past 5 years, the standard deviation of the fund is 7.13% compared to the category average of 13.15%. This makes the fund less volatile than its peers over the past half-decade.
With a beta of 0.83, this fund is less volatile than a broad market index of fixed income securities. Taking this into account, MEMTX has a negative alpha of -1.61, 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, MEMTX has 45.81% in high quality bonds rated at least 'AA' or higher, while 25.43% are of medium quality, with ratings of 'A' to 'BBB'. The fund has an average quality of A, and focuses on high quality securities.
However, it is worth noting that 21 % of the bonds in this fund are not ranked, so take the average quality level with a bit of caution.
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, MEMTX is a load fund. It has an expense ratio of 0.79% compared to the category average of 0.78%. So, MEMTX is actually more expensive than its peers from a cost perspective.
This fund requires a minimum initial investment of $1,000, and each subsequent investment should be at least $50.
Bottom Line
Overall, BlackRock Strategic Municipals Opportunities A ( MEMTX ) has a high Zacks Mutual Fund rank, and in conjunction with its comparatively weak performance, better downside risk, and higher fees, this fund looks like a good potential choice for investors right now.
For additional information on this product, or to compare it to other mutual funds in the Mutual Fund Bond, make sure to go to www.zacks.com/funds/mutual-funds for additional information. For analysis of the rest of your portfolio, make sure to visit Zacks.com for our full suite of tools which will help you investigate all of your stocks and funds in one place.
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