USAA High Income Fund (USHYX)

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Since the federal reserve is going to maintain the current interest rate in USA until 2013, investing in High Yield bond fund can be very attractive. One of this best high yield bond fund is USAA High Yield Opportunities. I'll provide this fund review and the fund performance details.
USAA High Income Fund (Ticker: USHYX)

USAA High Income Fund is previously known as USAA High-Yield Opportunities fund. The mutual fund seeks attractive total return through high current income. The fund’s secondary objective is to provide capital appreciation. The fund usually invests most of assets (>80%) in high-yield securities, including bonds or debts, preferred stocks, or convertible bonds. Although the fund invests mainly in U.S. securities, it may invest without limit in dollar denominated foreign securities and to some securities in non-dollar-denominated foreign securities.

USHYX Fund Details
USAA High Income Fund (USHYX)
USAA USHYX fund details
  • Fund Inception Date: August 2, 1999
  • Ticker Symbol: USHYX
  • CUSIP: 90328884
  • Beta (3yr): 0.84
  • Rank in category (YTD): 5
  • Category: High Yield Bond
  • Distribution: 7.08%
  • Capital Gains: N/A
  • Number of Years Up: 8 years
  • Number of Years Down: 3 years
  • Average Effective Duration: 4.01
  • Average Effective Maturity: 6.89
updated on 9/19/2011

Since 2007, Julianne Matthew Bass has been the lead fund's manager of this USAA fund. The fund’s expense ratio is 0.91% per year. The average expense ratio of this high yield bond fund is 1.17%. As part of no load fund, this USAA high yield fund doesn’t have any sales load (i.e. front sales load and deferred sales load). The fund’s total net assets are $1.6 billion. The fund also has a dividend yield of 7.08%.

As part of taxable bond fund, this USAA High-Yield Opportunities fund has 4-stars rating from Morningstar. The best 1-year total return was recorded in 2009 with 54.19%. The worst performance year occurred in 2008 with -28.09%.  It has returned 19.84% over the past one year and 8.65% over the past five years. This fund is available in another class such as UHYOX. This UHYOX fund has higher expense ratio with 1.20% fee per year.
Top Bond FundThe fund has been open to investor since 1999. Investor can invest in this best fund with $3,000 minimum investment balance for regular brokerage account and $250 for retirement account (IRA). USHYX fund can be purchased from 20 brokerages include Pershing Fund Center, TD Ameritrade, T Rowe Price, JPMorgan, TIAA-CREF Brokerage Services, Ameritas NTF, Dreyfus NTF,etc.

The top five holdings of this fund as of February 2011 are iShares iBoxx $ High Yield Corporate Bond, SPDR Barclays Capital High Yield Bond, Sonoco Products Co, Enbridge Engy Partners L P FRN, and Ppl Cap Fdg FRN. The fund top 5 sectors include US Corporate bond (86.17%), Foreign Corporate (8.24%), Asset Backed (2.76%), Mortgage CMO (2.4%), and Municipal (0.37%).

Pros:
  • It is ranked as the best high yield bond mutual fund
  • High yield for extra income
  • No sales load
Cons:
  • high risk due to junk bond

Disclosure: No Position

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