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15 important things you should know about American Funds TAFTX mutual fund

Updated: Last Friday
67
Bull Case
  • 3-year return above the benchmark
  • 5-year return above the benchmark
  • 10-year return above the benchmark
  • 15-year return above the benchmark
Bear Case
  • High expense ratio
  • Sales load and/or distribution fees

Before we start: if you’re looking for TAFTX “stock” price, you can quickly find it out by visiting Finny and typing "TAFTX quote". If you’re looking for a quick scoop on TAFTX "stock" (price chart, key stats, buy or sell analysis and holdings), go to Finny and look for "TAFTX". You’ll get all this info in one place.

Are you looking to buy or sell TAFTX? Or perhaps you’re looking for TAFTX fact sheet, and learn about its alternatives? If so, you came to the right place.

In this TAFTX mutual fund review, we’ll address key questions our readers have been asking us about this fund, above and beyond what you can find in its prospectus, and on Morningstar or Yahoo Finance.

Here is what you’ll be able to find in this review:

  • Fact Sheet: TAFTX performance, returns, expense ratio, holdings and dividend yield;
  • Analysis: TAFTX buy or sell; the pros and cons of investing in TAFTX mutual fund;
  • Alternatives: other ETFs and mutual funds you should consider as alternatives to TAFTX.

And here is the list of questions we’ll answer:

  1. Describe American Funds Tax-Exempt Series II: Tax-Exempt Fund of California; Class A Shares (TAFTX).
  2. What are TAFTX holdings?
  3. What is TAFTX performance? What are TAFTX historical returns?
  4. How many up and down years did TAFTX have historically?
  5. What is TAFTX dividend yield?
  6. What is TAFTX minimum initial investment amount?
  7. What is TAFTX expense ratio?
  8. Does TAFTX have any sales loads or 12b-1 distribution expenses?
  9. What is TAFTX tax efficiency (tax-cost ratio)?
  10. What is TAFTX beta? How would you assess TAFTX risk?
  11. What is TAFTX Sharpe ratio?
  12. What is TAFTX Finny Score? TAFTX buy or sell?
  13. What are the pros of investing in TAFTX? What are TAFTX buy reasons?
  14. What are the cons of investing in TAFTX? What are TAFTX sell reasons?

So let’s start. Scroll down to the question that interests you the most.

Fact Sheet

1. Describe American Funds Tax-Exempt Series II: Tax-Exempt Fund of California; Class A Shares (TAFTX).

The Fund seeks to provide a high level of current income exempt from regular federal and California income taxes. Its secondary objective is preservation of capital. The Fund seeks to achieve its objectives by primarily investing in municipal bonds issued by the state of California and its agencies and municipalities.

2. What are TAFTX top holdings?

TAFTX has 0 stock holdings and 1,238 bond holdings.

The top 9 holdings represent 5.77% of total assets. Here are the top holdings:

Name Symbol % Assets
CALIFORNIA HSG FIN AGY MUN CTFS 4% N/A 0.96%
BAY AREA TOLL AUTH CALIF TOLL BRDG REV 5% N/A 0.84%
CALIFORNIA ST DEPT WTR RES CENT VY PROJ REV 4% N/A 0.83%
FRETE 2019-ML05 TR 3.35% N/A 0.61%
CALIFORNIA ST 4% N/A 0.60%
CALIFORNIA HEALTH FACS FING AUTH REV 4% N/A 0.51%
CALIFORNIA ST 5% N/A 0.49%
IRVINE CALIF UNI SCH DIST SPL TAX 4% N/A 0.47%
CALIFORNIA POLLUTION CTL FING AUTH REV 4.75% N/A 0.46%

3. What is TAFTX performance? What are TAFTX historical returns?

TAFTX has generated the following returns:

  • 1-month return is 1.69%;
  • 3-month return is 1.00%;
  • 1-year return is 4.11%;
  • 3-year return is 4.18%;
  • 5-year return is 3.64%;
  • 10-year return is 4.79%;
  • 15-year return is 4.33%.

4. How many up and down years did TAFTX have historically?

In the last 10 years, TAFTX had 8 up years and 2 down years.

TAFTX up and down years

5. What is TAFTX dividend yield?

TAFTX yield is 2.33%.

6. What is TAFTX minimum initial investment amount?

TAFTX minimum initial investment amount is $1.00K.

7. What is TAFTX expense ratio?

TAFTX expense ratio is 0.61%. The expense ratio of a fund is the total percentage of fund assets used for administrative, management, and all other expenses.

TAFTX expenses

8. Does TAFTX have any sales loads or 12b-1 distribution expenses?

TAFTX 12b-1 distribution fee is 0.25. TAFTX front-end sales load is 3.75. TAFTX back-end sales load is 0.

9. What is TAFTX tax efficiency (tax-cost ratio)?

  • 1-year ax cost ratio is 0.13%;
  • 3-year ax cost ratio is 0.04%.
TAFTX tax costs

10. What is TAFTX beta? How would you assess TAFTX risk?

  • 3-year beta is 1.05;
  • 5-year beta is 1.04;
  • 10-year beta is 1.08.
TAFTX Beta

11. What is TAFTX Sharpe ratio?

  • 3-year Sharpe ratio is 0.54;
  • 5-year Sharpe ratio is 0.59;
  • 10-year Sharpe ratio is 0.89.
TAFTX Sharpe ratio

Analysis

12. What is Finny Score? buy or sell?

Finny Score is 67. Our quantitative analysis shows 4 reasons to buy and 2 reasons to sell it, resulting in the Finny Score of 67.

13. What are the pros of investing in TAFTX? What are TAFTX buy reasons?

The following are TAFTX strengths from our perspective:

  • TAFTX 3-year return is 4.18%, which is in line with the 3-year return of the benchmark index (Bloomberg Barclays Municipal California Exempt TR USD), 4.63%.
  • TAFTX 5-year return is 3.64%, which is in line with the 5-year return of the benchmark index (Bloomberg Barclays Municipal California Exempt TR USD), 3.92%.
  • TAFTX 10-year return is 4.79%, which is in line with the 10-year return of the benchmark index (Bloomberg Barclays Municipal California Exempt TR USD), 4.81%.
  • TAFTX 15-year return is 4.33%, which is in line with the 15-year return of the benchmark index (Bloomberg Barclays Municipal California Exempt TR USD), 4.63%.

14. What are the cons of investing in TAFTX? What are TAFTX negatives?

The following are TAFTX weaknesses from our perspective:

  • TAFTX expense ratio is 0.61%, which is not negligible. Is the fund expensive to you, and does it align to your investment strategy?
  • Warning: this fund has a 12b1 and front-end sales fee. The maximum 12b1 fee is 0.25%, while the maximum front-end sales load is 3.75%. A 12b-1 fee is an annual marketing or distribution fee on a mutual fund. Front-end sales load, also known as sales charge, is a fee paid when mutual funds shares are purchased. Those fees are subtracted from your total investable assets.
In the TAFTX review, we covered TAFTX key stats (return, performance, yield, expense ratio, and holdings), buy and sell analysis, and alternative investments. If this review was helpful to you, feel free to check out other mutual fund and ETF reviews.
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