There are plenty of choices in the High Yield - Bonds category, but where should you start your research? Well, one fund that might be worth investigating is PGIM High Yield Z (PHYZX). PHYZX carries a Zacks Mutual Fund Rank of 1 (Strong Buy), which is based on various forecasting factors like size, cost, and past performance.

Objective

PHYZX 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

PGIM is based in Providence, RI, and is the manager of PHYZX. Since PGIM High Yield Z made its debut in March of 1996, PHYZX has garnered more than $8.13 billion in assets. The fund's current manager is a team of investment professionals.

Performance

Investors naturally seek funds with strong performance. PHYZX has a 5-year annualized total return of 4.3% and it sits in the middle third among its category peers. Investors who prefer analyzing shorter time frames should look at its 3-year annualized total return of 2.54%, which places it in the middle 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. Compared to the category average of 13.32%, the standard deviation of PHYZX over the past three years is 8.15%. Over the past 5 years, the standard deviation of the fund is 9.56% compared to the category average of 14.25%. This makes the fund less volatile than its peers over the past half-decade.

PHYZX carries a beta of 0.29, 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 4.55, which measures performance on a risk-adjusted basis.

Ratings

Investors should also consider a bond's rating, which is a grade ( 'AAA' to 'D' ) given to a bond that indicates its credit quality. With this letter scale in mind, PHYZX 's junk bond component-bonds rated 'BB' or below-is at 81.46%. This means that the fund has an average quality of BBB, and focuses on medium quality securities.