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Is ACTDX a Strong Bond Fund Right Now?

MF Bond Report for ACTDX

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This story originally appeared on Zacks

If you have been looking for Mutual Fund Bond funds, a place to start could be Invesco High Yield Municipals Y (ACTDX). ACTDX carries a Zacks Mutual Fund Rank of 2 (Buy), which is based on nine forecasting factors like size, cost, and past performance.

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History of Fund/Manager

Invesco is based in Kansas City, MO, and is the manager of ACTDX. Invesco High Yield Municipals Y made its debut in March of 2006, and since then, ACTDX has accumulated about $3.01 billion in assets, per the most up-to-date date available. The fund's current manager is a team of investment professionals.

Performance

Investors naturally seek funds with strong performance. This fund has delivered a 5-year annualized total return of 6.02%, and is in the top 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 6.75%, 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. ACTDX's standard deviation over the past three years is 7.79% compared to the category average of 13.53%. The fund's standard deviation over the past 5 years is 6.26% compared to the category average of 11.25%. This makes the fund less volatile than its peers over the past half-decade.

With a beta of 0.77, this fund is less volatile than a broad market index of fixed income securities. Taking this into account, ACTDX has a negative alpha of -0.11, which measures performance on a risk-adjusted basis.

Ratings

However, it is worth noting that 40 % of the bonds in this fund are not ranked, so take the average quality level with a bit of caution.

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, ACTDX is a no load fund. It has an expense ratio of 0.62% compared to the category average of 0.80%. So, ACTDX is actually cheaper than its peers from a cost perspective.

Investors need to be aware that with this product, the minimum initial investment is $1,000; each subsequent investment needs to be at least $50.

Bottom Line

Overall, Invesco High Yield Municipals Y ( ACTDX ) has a high Zacks Mutual Fund rank, and in conjunction with its comparatively strong performance, average downside risk, and lower fees, this fund looks like a good potential choice for investors right now.

Your research on the Mutual Fund Bond segment doesn't have to stop here. You can check out all the great mutual fund tools we have to offer by going to www.zacks.com/funds/mutual-funds to see the additional features we offer as well 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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