Is DLSNX a Strong Bond Fund Right Now?

On the lookout for a Mortgage - Bonds: Misc fund? Starting with DoubleLine Low Duration Bond N (DLSNX) is one possibility. DLSNX possesses a Zacks Mutual Fund Rank of 1 (Strong Buy), which is based on various forecasting factors like size, cost, and past performance.

History of Fund/Manager

Double Line is based in Los Angeles, CA, and is the manager of DLSNX. DoubleLine Low Duration Bond N made its debut in September of 2011, and since then, DLSNX has accumulated about $711.15 million in assets, per the most up-to-date date available. The fund's current manager is a team of investment professionals.

Performance

Investors naturally seek funds with strong performance. This fund in particular has delivered a 5-year annualized total return of 2.91%, and is 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 4.43%, which places it in the top 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. DLSNX's standard deviation over the past three years is 1.75% compared to the category average of 10.09%. The standard deviation of the fund over the past 5 years is 1.67% compared to the category average of 9.83%. This makes the fund less volatile than its peers over the past half-decade.

Bond Duration

Modified duration is a measure of a specific bond's interest rate sensitivity, and is an excellent way to judge how fixed income securities will respond to a shifting rate environment.

For investors who think interest rates will rise, this is an important factor to consider. DLSNX has a modified duration of 1.68, which suggests that the fund will decline 1.68% for every hundred-basis-point increase in interest rates.

DLSNX carries a beta of 0.19, 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 0.92, which measures performance on a risk-adjusted basis.

Ratings

Expenses

Costs are increasingly important for mutual fund investing, and particularly as competition heats up in this market. And all things being equal, a lower cost product will outperform its otherwise identical counterpart, so taking a closer look at these metrics is key for investors. In terms of fees, DLSNX is a no load fund. It has an expense ratio of 0.68% compared to the category average of 0.82%. From a cost perspective, DLSNX is actually cheaper than its peers.

While the minimum initial investment for the product is $2,000, investors should also note that each subsequent investment needs to be at least $100.

Fees charged by investment advisors have not been taken into considiration. Returns would be less if those were included.

Bottom Line

Overall, DoubleLine Low Duration Bond N ( DLSNX ) has a high Zacks Mutual Fund rank, and in conjunction with its comparatively strong performance, better downside risk, and lower fees, DoubleLine Low Duration Bond N ( DLSNX ) looks like a good potential choice for investors right now.

Don't stop here for your research on Mortgage - Bonds: Misc funds. We also have plenty more on our site in order to help you find the best possible fund for your portfolio. Make sure to check out www.zacks.com/funds/mutual-funds for more information about the world of funds, and feel free to compare DLSNX to its peers as well for additional information. If you want to check out our stock reports as well, make sure to go to Zacks.com to see all of the great tools we have to offer, including our time-tested Zacks Rank.

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This article originally published on Zacks Investment Research (zacks.com).

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