BCRAX vs PEY Fund Comparison

A comparison between BCRAX and PEY based on their expense ratio, growth, holdings and how well they match their benchmark performance.

Group Created with Sketch.

Minafi's Take on BCRAX vs PEY

Here's an in depth look at the differences between BlackRock CoreAlpha Bond Fund Investor A Shares ($BCRAX) and Invesco High Yield Equity Dividend Achievers ETF ($PEY).

To start off, here's a look at the basics of each fund. Keep an eye on the FI Score. That's a custom score from 0 to 100 that we generate based on how good this fund is for the casual investor. Most investors only need a handful of total funds in their portfolio. The higher the score, the more likely this is one of those few. Score alone isn't enough! Keep reading on to see how different (or perhaps similar) these two funds are.

66% FI Score
  • bcrax
  • Mutual Fund
  • Bond
  • Total US Bond Market

BlackRock CoreAlpha Bond Fund Investor A Shares

Expenses: 0.53% (Better than 1% of similar funds)

This is an OK choice for a Total US Bond Market Bond fund. See why »

61% FI Score
  • pey
  • ETF
  • US Stocks
  • Mid-Cap Value

Invesco High Yield Equity Dividend Achievers ETF

Expenses: 0.53% (Better than 1% of similar funds)

This is an OK choice for a Mid-Cap Value US Stocks fund. See why »

$BCRAX is classified as a Mutual Fund while $PEY is classified as an ETF. Even though one of these is a mutual fund and the other is an ETF, that doesn't matter too much for their holdings. Both ETFs and mutual funds are just containers to hold lots of investments inside of them.

The biggest differences between these two is where they may be offered. ETFs are more widely availble from a larger number of investment apps and websites. Mutual funds, on the other hand, are generally offered by the platform they're issued by (Fidelity funds on Fidelity, Vanguard funds on Vanguard). Usually 401(k)'s will offer both ETFs and Mutual Funds. If you're investing outside of a 401(k), I'd recommend you verify the fees associated with ETF and mutual fund transactions. Some platforms charge an additional fee to purchase a mutual fund.

To learn more about the difference between these two, you can read about the difference between ETFs and Mutual Funds.

When evaluating a fund, the first things I look at are:

  • What it invests in
  • How much it charges in fees
  • How large the fund is

Let's look into these criteria one by one and see if either of these funds stands out.

Fund Holdings Comparison

Minafi's FI Score algorithm takes into account the category and market. The more niche a fund is, the lower the score. This doesn't mean it's a worse fund, but it does mean you should stop and make sure this a fund you need to diversify your portfolio.

BCRAX PEY
Market Score 6.3 /10 5.9 /10
Category Score 10.0 /10 5.0 /10
Total 16.3 10.9

A score of 10 means this is a solid market and category that almost every investor will want to have investments in. The lower the score, the more specific the investment. These scores are based on when most investors would add these funds to their portfolio. A score of 10 means that this fund (or one like it) belongs in a three-fund portfolio. The lower the score, the farther down in your portfolio a fund would go.

Winner: $BCRAX

Fee Comparison

Fees are one of the biggest killers of portfolio growth. The difference between a 2% fee and a 0.04% fee over 30 years can result in your portfolio having half the total value!

If you're just getting started investing and learning how fees impact your portfolio, I'd encourage you to read through my free investment course (specifically '2.2 - All About Fees') where I go over all the different types of fees you can be charged and how to lower them.

For these two funds, BCRAX has an expense ratio of 0.53% while PEY has an expense ratio of 0.53%.

Winner: tie

Fund Size Comparison

Both BCRAX and PEY have a similar number of assets under management. BCRAX has 1.68 Billion in assets under management, while PEY has 631 Million.

Minafi categorizes both of these funds as medium funds. Fund size is a good indication of how many other investors trust this fund. A large fund by itself doesn't mean it's a good fund, but it is one thing to consider when figuring out how to choose the right fund.

Winner: tie

Which Should You Choose? BCRAX or PEY?

Comparing these two funds isn't an apples to apples comparison. BCRAX is a Bond Total US Bond Market fund, while PEY is a US Stocks Mid-Cap Value fund.

If you're aiming to build a diversified, low-fee, tax-optimized portfolio you likely won't be choosing between these two funds since they're different enough.

Running both of these funds through Minafi's FI Score algorithm, gives BCRAX a score of 66 and PEY a score of 61.

Winner: Neither, I'd research more funds if you're looking to invest for retirement.

$BCRAX

BlackRock CoreAlpha Bond Fund Investor A Shares

66

Read More
Ratings
Rating Type Rating
Expense Ratio Score 8 /10
Expense Rating 5 /10
Market Score 6 /10
Category Score 10 /10
Overview
Overview Details
Fund Type Mutual Fund
Inception Date Feb-28-2011
Exchange NMFQS
Expense Ratio 0.530%
Net Assets 1.68 Billion
Yield 2.40%
Holdings
Description Info
Market Bond
Category Total US Bond Market
Sectors
  • Agency MBS ARM 0.05%
  • Agency MBS CMO 9.91%
  • Agency MBS Pass-Through 17.33%
  • Asset-Backed 12.93%
  • Bank Loan 0.00%
  • Cash & Equivalents 7.99%
  • Commercial MBS 1.90%
  • Convertible 2.08%
  • Corporate 48.80%
  • Corporate Bond 46.73%
  • Covered Bond 0.00%
  • Government 0.54%
  • Municipal 0.64%
  • Non-Agency Residential MBS 0.01%
  • Non-U.S. Government 0.43%
  • Other -0.10%
  • Other Government Related 0.11%
  • Preferred 0.00%
  • Securitized 42.13%
  • U.S. Agency 0.00%
  • U.S. Treasury 0.00%
  • U.S. Treasury Inflation-Protected 0.00%

$PEY

Invesco High Yield Equity Dividend Achievers ETF

61

Read More
Ratings
Rating Type Rating
Diversification Score 0 /10
Expense Ratio Score 8 /10
Expense Rating 5 /10
Market Score 6 /10
Category Score 5 /10
Overview
Overview Details
Fund Type ETF
Inception Date Dec-9-2004
Exchange NASDAQ
Expense Ratio 0.530%
Net Assets 631 Million
Yield 5.31%
Holdings
Description Info
Market US Stocks
Category Mid-Cap Value
Sectors
  • Basic Materials 3.59%
  • Communication Services 7.29%
  • Consumer Cyclicals 5.23%
  • Consumer Defensive 16.82%
  • Energy 12.62%
  • Financial Services 22.08%
  • Healthcare 6.23%
  • Industrials 8.55%
  • Real Estate 0.00%
  • Technology 1.99%
  • Utilities 15.58%
Regions
  • North America 100.00%

Adam says: Learn how to confidently invest for retirement!

Join the Minafi Investor Bootcamp to see how.

This 10-course bootcamp starts at only $10 for everything!

Minafi - The intersection of FI, minimalism & mindfulness.

Don't miss out on new posts, courses, interactive articles and more!

Join & Get Your First Course Free

© 2024   Adam Fortuna

Site Map
Triangle Graduation Cap Angle Down Book regular Phone laptop regular fire regular fire regular search regular Acorn duotone Seedling duotone thumbs down duo