TThere are many choices in the Diversified Bonds category, but where should you start your research? One fund that might be worth investigating is the PGIM Total Return Bond Z (PDBZX). PDBZX has a Zacks Mutual Fund Rank of 2 (Buy) based on nine forecast factors such as size, cost and past performance.
The world of diversified bonds funds is an area full of options like PDBZX. Investors looking for exposure to a variety of fixed income securities that span issuers, maturities and credit levels will find a good choice with Diversified Bonds funds. Typically, these funds have solid government bond exposure as well as modest positions in the corporate bond market.
History of the fund / manager
PDBZX is in the PGIM family and is based in Providence, RI. PGIM Total Return Bond Z debuted in September 1996. Since then, according to the latest information available, PDBZX has amassed approximately $ 32.82 billion in net worth. The fund is currently managed by a team of investment professionals.
Obviously, investors in these funds are looking for a strong performance compared to their peers. This fund has achieved an annualized 5 year total return of 4.19% and is in the middle third of its category. If you’re interested in shorter time frames, don’t miss the fund’s annualized 3-year total return of 5.43%, which puts it in the bottom third over that time frame.
When looking at the performance of a fund, it is also important to consider the standard deviation of returns. The lower the standard deviation, the less volatility the fund experiences. Over the past three years, the standard deviation of PDBZX is 5.94%, compared to the category mean of 13.49%. Looking at the last 5 years, the standard deviation of the fund is 5.13% compared to the category average of 11.21%. This makes the fund less volatile than its peers over the past half decade.
This fund has a beta of 1.3, which means it is more volatile than a broad fixed income market index. Against this background, PDBZX has a positive alpha of 0.42, which measures performance on a risk-adjusted basis.
Investors should also consider a bond’s rating, which is a grade (‘AAA’ to ‘D’) given to a bond that indicates its credit quality. Given this letter scale, PDBZX has 41.9% in high quality bonds with a rating of at least ‘AA’ or higher, while 34.9% is medium quality with ratings from ‘A’ to ‘BBB’. The fund has an average quality of A and focuses on high quality securities.
Cost is becoming increasingly important for mutual fund investments, especially as competition in this market intensifies. All other things being equal, a cheaper product will outperform its otherwise identical counterpart. It is therefore important for investors to take a closer look at these metrics. In terms of fees, PDBZX is a no-load fund. It has an expense ratio of 0.49% versus the category average of 0.86%. PDBZX is actually cheaper than its competitors when you factor in factors like cost.
Investors should also note that the minimum initial investment for the Product is $ 0 and there is no minimum amount for any subsequent investment.
Overall, the PGIM Total Return Bond Z (PDBZX) ranks high in the Zacks Mutual Fund and, coupled with its comparatively similar performance, better downside risk and lower fees, this fund appears to be a great potential investor choice right now.
Would you like more information about PDBZX? Then head over to Zacks.com and check out our mutual fund comparison tool and all the other great features we can help you with your mutual fund analysis for additional information. If you’re more of a stock investor, you should also check out our Zacks rankings and our full range of tools we have available for both novice and professional investors alike.
The views and opinions expressed herein are those of the author and do not necessarily reflect those of Nasdaq, Inc.