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Is Boston Partners Small Cap Value II Institutional (BPSIX) a Strong Mutual Fund Pick Right Now?

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Mutual Fund Equity Report fund seekers should not consider taking a look at Boston Partners Small Cap Value II Institutional (BPSIX - Free Report) at this time. BPSIX carries 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

BostonPartners is responsible for BPSIX, and the company is based out of New York, NY. Boston Partners Small Cap Value II Institutional debuted in July of 1998. Since then, BPSIX has accumulated assets of about $509.76 million, according to the most recently available information. The fund is currently managed by George Gumpert who has been in charge of the fund since April of 2009.

Performance

Obviously, what investors are looking for in these funds is strong performance relative to their peers. This fund has delivered a 5-year annualized total return of 4.3%, and it sits in the middle third among its category peers. If you're interested in shorter time frames, do not dismiss looking at the fund's 3 -year annualized total return of 14.96%, which places it in the middle third during this time-frame.

It is important to note that the product's returns may not reflect all its expenses. Any fees not reflected would lower the returns. Total returns do not reflect the fund's [%] sale charge. If sales charges were included, total returns would have been lower.

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. Compared to the category average of 18.34%, the standard deviation of BPSIX over the past three years is 21.83%. The standard deviation of the fund over the past 5 years is 25.68% compared to the category average of 20.43%. This makes the fund more volatile than its peers over the past half-decade.

Risk Factors

The fund has a 5-year beta of 1.18, so investors should note that it is hypothetically more 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. BPSIX has generated a negative alpha over the past five years of -5.18, demonstrating that managers in this portfolio find it difficult to pick securities that generate better-than-benchmark returns.

Holdings

Exploring 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 mostly on equities that are traded in the United States.

As of the last filing date, the mutual fund has 95.7% of its assets in stocks and it has 3.7% of assets in foreign securities. The fund has the heaviest exposure to the following market sectors:

  • Finance
  • Industrial Cyclical
  • Technology
  • Other
Turnover is 78%, which means this fund makes fewer trades than its comparable peers.

Expenses

For investors, taking a closer look at cost-related metrics is key, since costs are increasingly important for mutual fund investing. Competition is heating up in this space, and a lower cost product will likely outperform its otherwise identical counterpart, all things being equal. In terms of fees, BPSIX is a no load fund. It has an expense ratio of 0.99% compared to the category average of 1.21%. BPSIX is actually cheaper than its peers when you consider factors like cost.

Investors should also note that the minimum initial investment for the product is $100,000 and that each subsequent investment needs to be at $5,000

Fees charged by investment advisors have not been taken into considiration. Returns would be less if those were included.

Bottom Line

Overall, Boston Partners Small Cap Value II Institutional ( BPSIX ) has a low Zacks Mutual Fund rank, and in conjunction with its comparatively similar performance, worse downside risk, and lower fees, this fund looks like a somewhat weak choice for investors right now.

For additional information on this product, or to compare it to other mutual funds in the Mutual Fund Equity Report, make sure to go to www.zacks.com/funds/mutual-funds for additional information. Want to learn even more? We have a full suite of tools on stocks that you can use to find the best choices for your portfolio too, no matter what kind of investor you are.


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