PIMCO Unconstrained Tax Managed Bond Fund Class P (PUTPX)
Expense Ratio: 0.80%
Expected Lifetime Fees: $24,322.95
The PIMCO Unconstrained Tax Managed Bond Fund Class P fund (PUTPX) is a Nontraditional Bond fund started on 09/10/2009 and has $258.20 million in assets under management. The current manager has been running PIMCO Unconstrained Tax Managed Bond Fund Class P since 02/22/2009. The fund is rated by Morningstar. This fund does not charge 12b-1 fees.
iShares JPMorgan USD Emerging Markets Bond Fund (EMB)
Expense Ratio: 0.60%
Expected Lifetime Fees: $18,626.92
The iShares JPMorgan USD Emerging Markets Bond Fund (EMB) is an Exchange Traded Fund. It is a "basket" of securities that index the Nontraditional Bond investment strategy and is an alternative to a Nontraditional Bond mutual fund. Fees are very low compared to a comparable mutual fund like PIMCO Unconstrained Tax Managed Bond Fund Class P because computers automatically manage the stocks.
| Mutual Fund Name | Ticker Symbol | Turnover | Assets (M) | Annual Fees |
|---|---|---|---|---|
| BlackRock Strategic Income Opps Instl | BSIIX | 639.0% | 2,900 | 0.71% |
| Goldman Sachs Strategic Income Fund Class IR Shares | GZIRX | 636.0% | 1,900 | 0.77% |
| Goldman Sachs Strategic Income Fund Institutional Shares | GSZIX | 636.0% | 1,900 | 0.68% |
| PIMCO Floating Income Instl | PFIIX | 43.0% | 3,600 | 0.55% |
| PIMCO Unconstrained Tax Managed Bd Instl | PUTIX | 249.0% | 258 | 0.70% |
| Putnam Absolute Return 100 A | PARTX | 186.0% | 316 | 0.67% |
| Putnam Absolute Return 100 Fund Class Y | PARYX | 186.0% | 316 | 0.42% |
| Putnam Absolute Return 300 Fund Class Y | PYTRX | 188.0% | 1,100 | 0.62% |
Turnover
Turnover represents how much of a mutual fund's holdings are changed over the course of a year through buying and selling. Active mutual funds have an average turnover rate of about 85%,
meaning that funds are turning over nearly all of their holdings every year. A high turnover means you could make lower returns because: 1) buying and selling stocks costs money through
commissions and spreads and 2) the fund will distribute yearly capital gains which increases your taxes. Look for funds with turnover rates below 50%. For comparison, ETF turnover rates
average around 10% or lower.
Assets
Generally, smaller funds do better than larger ones. The more assets in a mutual fund, the lower the chance that it will beat its index. Managers outperform an index by choosing stocks
that are undervalued. In order to find these undervalued stocks, the manager has to know more than his competitors to develop an "edge." There are only a finite number of stocks a mutual
fund manager can reasonably analyze and actively track to gain such a competitive edge. When the fund has more assets, the manager must analyze large companies because he needs to take
larger positions. Large companies are more efficiently priced in the market and it becomes increasingly difficult to get an edge.
