Is LALDX a Strong Bond Fund Right Now?
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If investors are looking at the Government Bond - Short fund category, Lord Abbett Short Duration Income A (LALDX) could be a potential option. LALDX carries a Zacks Mutual Fund Rank of 2 (Buy), which is based on various forecasting factors like size, cost, and past performance.
Objective
The world of Government Bond - Short funds is an area filled with options, such as LALDX. Government Bond - Short funds hold securities issued by the federal government of the United States of America. These are seen as extremely low risk securities from a default perspective, and are often regarded as risk-free assets. This category focuses on the short end of the curve, and that results in lower yields, but also less sensitivity to interest rate fluctuations, too.
History of Fund/Manager
Lord Abbett is responsible for LALDX, and the company is based out of Jersey City, NJ. Lord Abbett Short Duration Income A debuted in November of 1993. Since then, LALDX has accumulated assets of about $7.19 billion, according to the most recently available information. The fund is currently managed by a team of investment professionals.
Performance
Obviously, what investors are looking for in these funds is strong performance relative to their peers. This fund carries a 5-year annualized total return of 2.82%, and is in the top 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 3.69%, which places it in the middle third during this time-frame.
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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. LALDX's standard deviation over the past three years is 2.38% compared to the category average of 12.66%. Looking at the past 5 years, the fund's standard deviation is 2.31% compared to the category average of 12.37%. This makes the fund less volatile than its peers over the past half-decade.
This fund has a beta of 0.26, meaning that it is less volatile than a broad market index of fixed income securities. Taking this into account, LALDX has a positive alpha of 1.11, 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, LALDX is a load fund. It has an expense ratio of 0.58% compared to the category average of 0.91%. So, LALDX is actually cheaper than its peers from a cost perspective.