Is BHYSX a Strong Bond Fund Right Now?
Having trouble finding a High Yield - Bonds fund? BlackRock High Yield Bond Services (BHYSX) is a potential starting point. BHYSX has a Zacks Mutual Fund Rank of 2 (Buy), which is based on various forecasting factors like size, cost, and past performance.
Objective
BHYSX is part of the High Yield - Bonds section, which is a segment that boasts many possible options. Often referred to as " junk " bonds, High Yield - Bonds funds sit below investment grade, meaning they are at a high default risk compared to their investment grade peers. However, one advantage to junk bonds is that they generally pay out higher yields while posing similar interest rate risks to their investment grade counterparts.
History of Fund/Manager
BlackRock is based in New York, NY, and is the manager of BHYSX. BlackRock High Yield Bond Services debuted in November of 1998. Since then, BHYSX has accumulated assets of about $83.46 million, according to the most recently available information. The fund is currently managed by Mitchell Garfin who has been in charge of the fund since December of 2009.
Performance
Of course, investors look for strong performance in funds. This fund has delivered a 5-year annualized total return of 6.24%, 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 6.09%, 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.
Advertisement: High Yield Savings Offers
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. Over the past three years, BHYSX's standard deviation comes in at 7.92%, compared to the category average of 12.64%. The standard deviation of the fund over the past 5 years is 7.38% compared to the category average of 12.33%. This makes the fund less volatile than its peers over the past half-decade.
BHYSX carries a beta of 0.13, meaning that the fund is less volatile than a broad market index of fixed income securities. With this in mind, it has a positive alpha of 6.51, 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, BHYSX is a no load fund. It has an expense ratio of 0.85% compared to the category average of 0.93%. Looking at the fund from a cost perspective, BHYSX is actually cheaper than its peers.