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Is American Funds Cap World Growth & Income A (CWGIX) a Strong Mutual Fund Pick Right Now?
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Mutual Fund Equity Report fund seekers should not consider taking a look at American Funds Cap World Growth & Income A (CWGIX - Free Report) at this time. CWGIX holds 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
American Funds is based in Los Angeles, CA, and is the manager of CWGIX. The American Funds Cap World Growth & Income A made its debut in March of 1993 and CWGIX has managed to accumulate roughly $60.35 billion in assets, as of the most recently available information. The fund is currently managed by a team of investment professionals.
Performance
Investors naturally seek funds with strong performance. This fund has delivered a 5-year annualized total return of 7.59%, and it sits in the middle third among its category peers. Investors who prefer analyzing shorter time frames should look at its 3-year annualized total return of 6.98%, which places it in the bottom 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, CWGIX's standard deviation comes in at 17.2%, compared to the category average of 14.8%. Over the past 5 years, the standard deviation of the fund is 14.99% compared to the category average of 13.11%. This makes the fund more volatile than its peers over the past half-decade.
Risk Factors
Investors should note that the fund has a 5-year beta of 0.87, which means it is hypothetically less 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 negative alpha of -3.97. This means that managers in this portfolio find it difficult to pick securities that generate better-than-benchmark returns.
Expenses
As competition heats up in the mutual fund market, costs become increasingly important. Compared to its otherwise identical counterpart, a low-cost product will be an outperformer, all other things being equal. Thus, taking a closer look at cost-related metrics is vital for investors. In terms of fees, CWGIX is a load fund. It has an expense ratio of 0.75% compared to the category average of 1.10%. So, CWGIX is actually cheaper than its peers from a cost perspective.
Investors need to be aware that with this product, the minimum initial investment is $250; each subsequent investment needs to be at least $50.
Bottom Line
Overall, American Funds Cap World Growth & Income A ( CWGIX ) has a low Zacks Mutual Fund rank, and in conjunction with its comparatively similar performance, average downside risk, and lower fees, this fund looks like a somewhat weak choice for investors right now.
This could just be the start of your research on CWGIXin the Mutual Fund Equity Report category. Consider going to www.zacks.com/funds/mutual-funds for additional information about this fund, and all the others that we rank as well for additional information. And don't forget, Zacks has all of your needs covered on the equity side too! Make sure to check out Zacks.com for more information on our screening capabilities, Rank, and all our articles as well.
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Is American Funds Cap World Growth & Income A (CWGIX) a Strong Mutual Fund Pick Right Now?
Mutual Fund Equity Report fund seekers should not consider taking a look at American Funds Cap World Growth & Income A (CWGIX - Free Report) at this time. CWGIX holds 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
American Funds is based in Los Angeles, CA, and is the manager of CWGIX. The American Funds Cap World Growth & Income A made its debut in March of 1993 and CWGIX has managed to accumulate roughly $60.35 billion in assets, as of the most recently available information. The fund is currently managed by a team of investment professionals.
Performance
Investors naturally seek funds with strong performance. This fund has delivered a 5-year annualized total return of 7.59%, and it sits in the middle third among its category peers. Investors who prefer analyzing shorter time frames should look at its 3-year annualized total return of 6.98%, which places it in the bottom 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, CWGIX's standard deviation comes in at 17.2%, compared to the category average of 14.8%. Over the past 5 years, the standard deviation of the fund is 14.99% compared to the category average of 13.11%. This makes the fund more volatile than its peers over the past half-decade.
Risk Factors
Investors should note that the fund has a 5-year beta of 0.87, which means it is hypothetically less 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 negative alpha of -3.97. This means that managers in this portfolio find it difficult to pick securities that generate better-than-benchmark returns.
Expenses
As competition heats up in the mutual fund market, costs become increasingly important. Compared to its otherwise identical counterpart, a low-cost product will be an outperformer, all other things being equal. Thus, taking a closer look at cost-related metrics is vital for investors. In terms of fees, CWGIX is a load fund. It has an expense ratio of 0.75% compared to the category average of 1.10%. So, CWGIX is actually cheaper than its peers from a cost perspective.
Investors need to be aware that with this product, the minimum initial investment is $250; each subsequent investment needs to be at least $50.
Bottom Line
Overall, American Funds Cap World Growth & Income A ( CWGIX ) has a low Zacks Mutual Fund rank, and in conjunction with its comparatively similar performance, average downside risk, and lower fees, this fund looks like a somewhat weak choice for investors right now.
This could just be the start of your research on CWGIXin the Mutual Fund Equity Report category. Consider going to www.zacks.com/funds/mutual-funds for additional information about this fund, and all the others that we rank as well for additional information. And don't forget, Zacks has all of your needs covered on the equity side too! Make sure to check out Zacks.com for more information on our screening capabilities, Rank, and all our articles as well.