Yahoo Finance Is SWRSX a Strong Bond Fund Right Now?
There are plenty of choices in the Government - Bonds: Misc category, but where should you start your research? Well, one fund that might be worth investigating is Schwab Treasury Inflation Protected Security (SWRSX). SWRSX has no Zacks Mutual Fund Rank, but we have been able to look into other metrics like performance, volatility, and cost.
Objective
We note that SWRSX is a Government - Bonds: Misc option, and this area is loaded with many different choices. Often seen as risk-free assets and described as extremely low-risk from a default perspective, Government - Bonds: Misc funds hold securities issued by the United States' federal government. This category stretches across the curve, meaning the yields and interest rate sensitivity will vary, but a mixed approach can typically result in a medium yield and risk profile.
History of Fund/Manager
Schwab Funds is based in San Francisco, CA, and is the manager of SWRSX. Since Schwab Treasury Inflation Protected Security made its debut in March of 2006, SWRSX has garnered more than $2.61 billion in assets. Matthew Hastings is the fund's current manager and has held that role since March of 2006.
Performance
Obviously, what investors are looking for in these funds is strong performance relative to their peers. SWRSX has a 5-year annualized total return of 2.02% and it sits in the middle third among its category peers. But if you are looking for a shorter time frame, it is also worth looking at its 3-year annualized total return of -1.47%, 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. Over the past three years, SWRSX's standard deviation comes in at 7.13%, compared to the category average of 7.57%. Over the past 5 years, the standard deviation of the fund is 6.26% compared to the category average of 6.84%. This makes the fund less volatile than its peers over the past half-decade.
This fund has a beta of 0.61, meaning that it is less volatile than a broad market index of fixed income securities. Taking this into account, SWRSX has a positive alpha of 1.88, which measures performance on a risk-adjusted basis.
Expenses
As competition heats up in the mutual fund market, costs become increasingly important. Compared to its otherwise identical counterpart, a low-cost product will be an outperformer, all other things being equal. Thus, taking a closer look at cost-related metrics is vital for investors. In terms of fees, SWRSX is a no load fund. It has an expense ratio of 0.05% compared to the category average of 0.59%. From a cost perspective, SWRSX is actually cheaper than its peers.
Investors need to be aware that with this product, the minimum initial investment is $0; each subsequent investment has no minimum amount.
Fees charged by investment advisors have not been taken into considiration. Returns would be less if those were included.
Bottom Line
This could just be the start of your research on SWRSXin the Government - Bonds: Misc 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. And don't forget, Zacks has all of your needs covered on the equity side too! Make sure to check out Zacks.com for more information on our screening capabilities, Rank, and all our articles as well.
Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
Get Your Free (SWRSX): Fund Analysis Report
