Sponsored by:

Mainstay High Yield Fund Cashes in on Junk Corporate Bonds

Despite low performance, junk bonds provide big yield

   

Mainstay High Yield Fund Cashes in on Junk Corporate Bonds

The Mainstay High Yield Opportunities Class C Fund (MUTF: MYHYX) is an IRA fund on the hunt for current income by investing in high-yield domestic and foreign corporate junk bonds. It generally holds long positions, equal to approximately 140% of net assets and short positions, equal to approximately 40% of net assets.

Here are the specifics for the Mainstay High Yield Opportunities Class C Fund for today’s mutual fund spotlight:

Investing Strategy: The fund usually takes long and short positions, either directly or  indirectly through derivatives. Proceeds from the short positions typically are used to purchase all or a portion of the additional long positions. Some 86% of the fund’s assets are in bonds, 8% is in cash and about 3.5% are in common and preferred stocks.

Expense Ratio: With a 2.09% expense ratio and 1% deferred load, the fund is expensive, but has a Morningstar Rating of five stars.

Top 5 Holdings: The top stocks in the Mainstay High Yield Opportunities Class C Fund include Ally Financial 144A 7.5% yield corporate bonds at 2.0% of the portfolio, U.S. Treasury Notes with a 1.25% at 1.37% of the portfolio, Cit Group 7% yield corporate bonds at 1.23% of holdings, GMAC  8% bonds at 1.05%, U.S. auto maker Ford Motor Co (NYSE: F) at 1.04%

Returns: The Mainstay High Yield Opportunities Class Fund was established in December 2007. Its 12-month return of 4.62% underperformed the broader market’s 17% during the period.

Other Fund Statistics

  • Total Assets: $1.10 billion (as of 6/27/11)
  • Minimum Investment: $1,000
  • Fund manager: Taylor Wagenseil, Dan Roberts, Louis Cohen and Michael Kimble)
  • Manager’s Tenure: All since December 2007

Article printed from InvestorPlace Media, http://investorplace.com/2011/07/mainstay-high-yield-fund-junk-bonds-corporate-bond/.

©2014 InvestorPlace Media, LLC

Comments are currently unavailable. Please check back soon.