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Is Lord Abbett Alpha Strategy A (ALFAX) a Strong Mutual Fund Pick Right Now?
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Having trouble finding a Mutual Fund Equity Report fund? Lord Abbett Alpha Strategy A (ALFAX - Free Report) is a possible starting point. ALFAX carries a Zacks Mutual Fund Rank of 3 (Hold), which is based on nine forecasting factors like size, cost, and past performance.
History of Fund/Manager
Lord Abbett is based in Jersey City, NJ, and is the manager of ALFAX. The Lord Abbett Alpha Strategy A made its debut in March of 1998 and ALFAX has managed to accumulate roughly $420.52 million in assets, as of the most recently available information. The fund's current manager is a team of investment professionals.
Performance
Of course, investors look for strong performance in funds. ALFAX has a 5-year annualized total return of 5.25% and is in the bottom third among its category peers. But if you are looking for a shorter time frame, it is also worth looking at its 3-year annualized total return of 5.84%, 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, ALFAX's standard deviation comes in at 25.14%, compared to the category average of 17.51%. The fund's standard deviation over the past 5 years is 22.33% compared to the category average of 15.46%. This makes the fund more volatile than its peers over the past half-decade.
Risk Factors
With a 5-year beta of 1.11, the fund is likely to be more volatile than the market average. Alpha is an additional metric to take into consideration, since it represents a portfolio's performance on a risk-adjusted basis relative to a benchmark, which in this case, is the S&P 500. ALFAX has generated a negative alpha over the past five years of -4.97, demonstrating that managers in this portfolio find it difficult to pick securities that generate better-than-benchmark returns.
Holdings
Examining the equity holdings of a mutual fund is also a valuable exercise. This can show us how the manager is applying their stated methodology, as well as if there are any inherent biases in their approach. For this particular fund, the focus is principally on equities that are traded in the United States.
Right now, 77.55% of this mutual fund's holdings are stocks and it has a negligible amount of assets in foreign securities. Turnover is 8%, which means this fund makes fewer trades than comparable funds.
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, ALFAX is a load fund. It has an expense ratio of 0.43% compared to the category average of 1.09%. So, ALFAX is actually cheaper than its peers from a cost perspective.
Investors should also note that the minimum initial investment for the product is $1,500 and that each subsequent investment has no minimum amount.
Bottom Line
Overall, Lord Abbett Alpha Strategy A ( ALFAX ) has a neutral Zacks Mutual Fund rank, and in conjunction with its comparatively weak performance, worse downside risk, and lower fees, Lord Abbett Alpha Strategy A ( ALFAX ) looks like a somewhat average choice for investors right now.
For additional information on the Mutual Fund Equity Report area of the mutual fund world, make sure to check out www.zacks.com/funds/mutual-funds. There, you can see more about the ranking process, and dive even deeper into ALFAX too 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 Lord Abbett Alpha Strategy A (ALFAX) a Strong Mutual Fund Pick Right Now?
Having trouble finding a Mutual Fund Equity Report fund? Lord Abbett Alpha Strategy A (ALFAX - Free Report) is a possible starting point. ALFAX carries a Zacks Mutual Fund Rank of 3 (Hold), which is based on nine forecasting factors like size, cost, and past performance.
History of Fund/Manager
Lord Abbett is based in Jersey City, NJ, and is the manager of ALFAX. The Lord Abbett Alpha Strategy A made its debut in March of 1998 and ALFAX has managed to accumulate roughly $420.52 million in assets, as of the most recently available information. The fund's current manager is a team of investment professionals.
Performance
Of course, investors look for strong performance in funds. ALFAX has a 5-year annualized total return of 5.25% and is in the bottom third among its category peers. But if you are looking for a shorter time frame, it is also worth looking at its 3-year annualized total return of 5.84%, 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, ALFAX's standard deviation comes in at 25.14%, compared to the category average of 17.51%. The fund's standard deviation over the past 5 years is 22.33% compared to the category average of 15.46%. This makes the fund more volatile than its peers over the past half-decade.
Risk Factors
With a 5-year beta of 1.11, the fund is likely to be more volatile than the market average. Alpha is an additional metric to take into consideration, since it represents a portfolio's performance on a risk-adjusted basis relative to a benchmark, which in this case, is the S&P 500. ALFAX has generated a negative alpha over the past five years of -4.97, demonstrating that managers in this portfolio find it difficult to pick securities that generate better-than-benchmark returns.
Holdings
Examining the equity holdings of a mutual fund is also a valuable exercise. This can show us how the manager is applying their stated methodology, as well as if there are any inherent biases in their approach. For this particular fund, the focus is principally on equities that are traded in the United States.
Right now, 77.55% of this mutual fund's holdings are stocks and it has a negligible amount of assets in foreign securities. Turnover is 8%, which means this fund makes fewer trades than comparable funds.
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, ALFAX is a load fund. It has an expense ratio of 0.43% compared to the category average of 1.09%. So, ALFAX is actually cheaper than its peers from a cost perspective.
Investors should also note that the minimum initial investment for the product is $1,500 and that each subsequent investment has no minimum amount.
Bottom Line
Overall, Lord Abbett Alpha Strategy A ( ALFAX ) has a neutral Zacks Mutual Fund rank, and in conjunction with its comparatively weak performance, worse downside risk, and lower fees, Lord Abbett Alpha Strategy A ( ALFAX ) looks like a somewhat average choice for investors right now.
For additional information on the Mutual Fund Equity Report area of the mutual fund world, make sure to check out www.zacks.com/funds/mutual-funds. There, you can see more about the ranking process, and dive even deeper into ALFAX too 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.