Is FCAMX a Strong Bond Fund Right Now?
If investors are looking at the Mutual Fund Bond fund category, Franklin California High Yield Municipals A (FCAMX) could be a potential option. FCAMX bears a Zacks Mutual Fund Rank of 1 (Strong Buy), which is based on nine forecasting factors like size, cost, and past performance.
History of Fund/Manager
FCAMX is a part of the Franklin Templeton family of funds, a company based out of San Mateo, CA. The Franklin California High Yield Municipals A made its debut in May of 1993 and FCAMX has managed to accumulate roughly $1.02 billion in assets, as of the most recently available information. The fund is currently managed by a team of investment professionals.
Performance
Of course, investors look for strong performance in funds. This fund has delivered a 5-year annualized total return of 2.15%, and it sits 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 0.48%, 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. FCAMX's standard deviation over the past three years is 7.15% compared to the category average of 13.19%. Looking at the past 5 years, the fund's standard deviation is 5.83% compared to the category average of 11.69%. This makes the fund less volatile than its peers over the past half-decade.
With a beta of 0.94, this fund is less volatile than a broad market index of fixed income securities. Taking this into account, FCAMX has a positive alpha of 0.18, which measures performance on a risk-adjusted basis.
Ratings
However, it is worth noting that 43 % of the bonds in this fund are not ranked, so take the average quality level with a bit of caution.
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, FCAMX is a load fund. It has an expense ratio of 0.65% compared to the category average of 0.79%. FCAMX is actually cheaper than its peers when you consider factors like cost.
This fund requires a minimum initial investment of $1,000, while there is no minimum for each subsequent investment.
Bottom Line
Overall, Franklin California High Yield Municipals A ( FCAMX ) has a high Zacks Mutual Fund rank, and in conjunction with its comparatively strong performance, better downside risk, and lower fees, Franklin California High Yield Municipals A ( FCAMX ) looks like a good potential choice for investors right now.
This could just be the start of your research on FCAMXin the Mutual Fund Bond 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.
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