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There are plenty of choices in the Investment Grade Bond - Short category, but where should you start your research? Well, one fund that might be worth investigating is Thompson Bond Fund (THOPX). THOPX has a Zacks Mutual Fund Rank of 1 (Strong Buy), which is based on various forecasting factors like size, cost, and past performance.
Objective
THOPX is classified in the Investment Grade Bond - Short segment by Zacks, an area full of investment potential. By investing in bonds that mature in less than two years, Investment Grade Bond - Short funds are focused on the short end of the curve. Fixed income instruments at this maturity level tend to have low duration risk, but they also pay out small yields compared to their longer-dated peers. Furthermore, these funds'focus on investment grade make them safer, but yields will be lower than in the junk bond category.
History of Fund/Manager
Thompson is based in Madison, WI, and is the manager of THOPX. Thompson Bond Fund made its debut in February of 1992, and since then, THOPX has accumulated about $1.72 billion in assets, per the most up-to-date date available. The fund is currently managed by Jason Stephens who has been in charge of the fund since February of 2009.
Performance
Obviously, what investors are looking for in these funds is strong performance relative to their peers. THOPX has a 5-year annualized total return of 3.1% 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 4.47%, which places it in the top 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. The standard deviation of THOPX over the past three years is 3.66% compared to the category average of 2.9%. The fund's standard deviation over the past 5 years is 5.71% compared to the category average of 3.22%. This makes the fund more volatile than its peers over the past half-decade.
With a beta of 0.22, this fund is less volatile than a broad market index of fixed income securities. Taking this into account, THOPX has a positive alpha of 1.61, which measures performance on a risk-adjusted basis.