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Is Firsthand Technology Opportunities (TEFQX) a Strong Mutual Fund Pick Right Now?

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There are plenty of choices in the Mutual Fund Equity Report category, but where should you start your research? Well, one fund that may not be worth investigating is Firsthand Technology Opportunities (TEFQX - Free Report) . TEFQX bears a Zacks Mutual Fund Rank of 5 (Strong Sell), which is based on nine forecasting factors like size, cost, and past performance.

History of Fund/Manager

Firsthand is responsible for TEFQX, and the company is based out of San Jose, CA. Firsthand Technology Opportunities debuted in September of 1999. Since then, TEFQX has accumulated assets of about $414 million, according to the most recently available information. The fund is currently managed by Kevin M. Landis who has been in charge of the fund since September of 1999.

Performance

Obviously, what investors are looking for in these funds is strong performance relative to their peers. This fund carries a 5-year annualized total return of 27.82%, and it sits in the top third among its category peers. Investors who prefer analyzing shorter time frames should look at its 3-year annualized total return of 28.14%, which places it in the middle third during this time-frame.

When looking at a fund's performance, it is also important to note the standard deviation of the returns. The lower the standard deviation, the less volatility the fund experiences. Over the past three years, TEFQX's standard deviation comes in at 30.15%, compared to the category average of 22.06%. The fund's standard deviation over the past 5 years is 25.86% compared to the category average of 20.26%. This makes the fund more volatile than its peers over the past half-decade.

Risk Factors

The fund has a 5-year beta of 1.09, so investors should note that it is hypothetically more volatile than the market at large. Because alpha represents a portfolio's performance on a risk-adjusted basis relative to a benchmark, which is the S&P 500 in this case, one should pay attention to this metric as well. Over the past 5 years, the fund has a positive alpha of 8.5. This means that managers in this portfolio are skilled in picking securities that generate better-than-benchmark returns.

Expenses

Costs are increasingly important for mutual fund investing, and particularly as competition heats up in this market. And all things being equal, a lower cost product will outperform its otherwise identical counterpart, so taking a closer look at these metrics is key for investors. In terms of fees, TEFQX is a no load fund. It has an expense ratio of 1.83% compared to the category average of 1.29%. From a cost perspective, TEFQX is actually more expensive than its peers.

Investors should also note that the minimum initial investment for the product is $2,000 and that each subsequent investment needs to be at $50.

Bottom Line

Overall, Firsthand Technology Opportunities ( TEFQX ) has a low Zacks Mutual Fund rank, and in conjunction with its comparatively strong performance, worse downside risk, and higher fees, this fund looks like a poor potential choice for investors right now.

Want even more information about TEFQX? Then go over to Zacks.com and check out our mutual fund comparison tool, and all of the other great features that we have to help you with your mutual fund analysis for additional information. If you are more of a stock investor, make sure to also check out our Zacks Rank, and our full suite of tools we have available for novice and professional investors alike.


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