Continuing with the series of (401)k funds reviews, below are reviews of the Goldman Sachs High Yield and Morgan Stanley Institutional Small Growth funds.
Goldman Sachs High Yield (GSHIX)
Category: High Yield Bond
Rating: 4
Capital Gains Exposure: -43%
Assets: $3.128 bil
Expense Ratio: 0.73%
Turnover Ratio: 11%
Yield: 11.77%
Redemption Period: 60 days
Redemption Fee: 2%
3-Year Total Cost: $240
Minimum Investment: $10,000,000
Comments: This fund has 86% in Bonds and 12% in Cash. It holds AAA (14), BBB (5), BB (24), B (44), and Below B (13) quality bonds. The bonds are in the following sectors: Corporate (75) and Foreign Corp (13). This fund performs well relative to it's category. It's ranked in the top 10% for it's category. This is a solid fund that is fairly cheap and is more likely to do well than not. Although I'm not too keen investing into bonds right now, this fund is yielding quite a bit to compensate for that risk.
Grade: B-
Morgan Stanley Institutional Small Growth (MSSGX)
Category: Small Growth
Rating: 4
Capital Gains Exposure: -41%
Assets: $1.055 bil
Expense Ratio: 1.01%
Turnover Ratio: 76%
Yield: 0.0%
Redemption Period: 30 days
Redemption Fee: 2%
3-Year Total Cost: $322
Minimum Investment: closed
Comments: This fund invests into Medium (27), Small (64), and Micro (9) companies. It invests into the following sectors: Healthcare (11), Consumer Services (19), Business Services (25), Financials (6), Consumer goods (11), Industrial Materials (9), and Energy (10). The fund has 65 holdings and keeps 35% of assets in the top ten holdings. This fund's performance is mediocre, but not terrible. It is ranked in the top 20% percent peers for the 10-year period and has returned annualized 7% over that same period. This is an OK fund, but I would prefer to invest in a steller small-cap fund if I were to invest in the small-caps at all. Small-caps are bound to underperform the market in the near future.
Grade: C-
