TCW Total Return Bond Fund

5 / 5 Stars
5 5 5 4 1
Zacks Investment Research
1 (Strong Buy)
Standard & Poor's
4 / 5 Stars
A+ (Buy)

U.S. News evaluated 278 Intermediate-Term Bond Funds. Our list highlights the top-rated funds for long-term investors based on the ratings of leading fund industry researchers.

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Note: Profile written for different share class.


The fund has returned 1.73 percent over the past year, 5.96 percent over the past three years, 9.24 percent over the past five years, and 6.56 percent over the past decade.

Trailing Returns Updated 03.31.2014
Year to date 1.4%
1 Year 1.7%
3 Years (Annualized) 6.0%
5 Years (Annualized) 9.2%
10 Years (Annualized) 6.6%

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TCW Total Return Bond has shown considerable expertise in the mortgage-backed securities market.

As of April 22, 2014, the fund has assets totaling $7.54 billion. Its portfolio consists of mortgage-backed securities.

TCW fired Jeffrrey Gundlach, the firm's chief investment officer and a co-manager of the fund. The move, which came in late 2009, was a response to fears that Gundlach would leave TCW on his own and take other important players with him. The departures angered a number of clients and touched off concerns about the fund's future. But after the fund's solid performance in the first three quarters of 2010, those fears are quickly receding. A team from MetWest Asset Management now runs the fund. As of May, management is now allowed to invest up to half of the portfolio in junk bonds. The fund has returned 1.73 percent over the past year and 5.96 percent over the past three years.

The fund has a long track record of steady returns. It has traditionally focused on agency mortgages, and management has shown an ability to pick bonds wisely. The fund has also demonstrated a willingness to employ risk-hedging strategies where necessary. The fund has returned 9.24 percent over the past five years and 6.56 percent over the past decade.

Investment Strategy

Says Morningstar, "Management keeps this mortgage-backed securities fund's duration (a measure of interest-rate sensitivity) between the (shorter) Barclays Capital Mortgage Backed Securities Index and the Barclays Capital Aggregate Bond Index, which is the benchmark for most core bond funds. That is intended to help keep the fund competitive with both basic government mortgage funds and intermediate-term bond portfolios. In that pursuit, the fund buys lots of out-of-index sectors such as collateralized mortgage obligations, private-label CMOs, ARMs, and inverse floaters."

Role in Portfolio

Morningstar calls it a "core" holding.


When it ousted Gundlach, TCW announced plans to purchase the money management firm Metropolitan West. MetWest's Tad Rivelle took over TCW's high-grade bond group and is this fund's manager.


TCW Total Return Bond Fund has an expense ratio of 0.73 percent.

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Says Morningstar, "Although management has done a great job at keeping risk in check, this fund does take on some unusual securities, such as inverse floaters."

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