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Is Virtus Duff & Phelps Water A (AWTAX) a Strong Mutual Fund Pick Right Now?

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If you have been looking for Mutual Fund Equity Report funds, it would not be wise to start your search with Virtus Duff & Phelps Water A (AWTAX - Free Report) . AWTAX bears a Zacks Mutual Fund Rank of 4 (Sell), which is based on various forecasting factors like size, cost, and past performance.

History of Fund/Manager

Virtus Funds is based in Hartford, CT, and is the manager of AWTAX. Virtus Duff & Phelps Water A made its debut in April of 2008, and since then, AWTAX has accumulated about $227.92 million in assets, per the most up-to-date date available. The fund's current manager, David D. Grumhaus, has been in charge of the fund since July of 2022.

Performance

Of course, investors look for strong performance in funds. AWTAX has a 5-year annualized total return of 6.07% and it sits in the middle 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 4.94%, 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, AWTAX's standard deviation comes in at 21.2%, compared to the category average of 20.23%. The fund's standard deviation over the past 5 years is 18.49% compared to the category average of 17.86%. 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 0.9, which means it is hypothetically less volatile than the market at large. 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. Over the past 5 years, the fund has a negative alpha of -2.18. 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, AWTAX is a load fund. It has an expense ratio of 1.22% compared to the category average of 1.19%. AWTAX is actually more expensive than its peers when you consider factors like cost.

While the minimum initial investment for the product is $2,500, investors should also note that each subsequent investment needs to be at least $100.

Bottom Line

Overall, Virtus Duff & Phelps Water A ( AWTAX ) has a low Zacks Mutual Fund rank, and in conjunction with its comparatively similar performance, average downside risk, and higher fees, Virtus Duff & Phelps Water A ( AWTAX ) looks like a somewhat weak choice for investors right now.

Your research on the Mutual Fund Equity Report segment doesn't have to stop here. You can check out all the great mutual fund tools we have to offer by going to www.zacks.com/funds/mutual-funds to see the additional features we offer as well 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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