If you've been stuck searching for Small Cap Growth funds, consider Federated MDT Small Cap Growth Fund A (QASGX Quick QuoteQASGX - Free Report) as a possibility. QASGX carries a Zacks Mutual Fund Rank of 2 (Buy), which is based on various forecasting factors like size, cost, and past performance.

Objective

QASGX is part of the Small Cap Growth category, and this segment boasts an array of many other possible options. Small Cap Growth mutual funds usually focus their portfolios on stocks with large growth opportunities and a market cap of under $2 billion. These portfolios tend to feature small companies in up-and-coming industries and markets.

History of Fund/Manager

Federated is based in Pittsburgh, PA, and is the manager of QASGX. Federated MDT Small Cap Growth Fund A debuted in September of 2005. Since then, QASGX has accumulated assets of about $80.09 million, according to the most recently available information. The fund's current manager is a team of investment professionals.

Performance

Investors naturally seek funds with strong performance. This fund carries a 5-year annualized total return of 7.1%, 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 -0.74%, 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. Over the past three years, QASGX's standard deviation comes in at 21.92%, compared to the category average of 16.15%. The fund's standard deviation over the past 5 years is 24.52% compared to the category average of 17.35%. 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. With a negative alpha of -7.74, 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 primarily on equities that are traded in the United States.

The mutual fund currently has 84.57% of its holdings in stocks, with an average market capitalization of $2.97 billion. The fund has the heaviest exposure to the following market sectors:

• Technology
• Industrial Cyclical
• Health

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, QASGX is a load fund. It has an expense ratio of 1.13% compared to the category average of 1.01%. Looking at the fund from a cost perspective, QASGX is actually more expensive than its peers.

This fund requires a minimum initial investment of $1,500, and each subsequent investment should be at least $100.

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

Bottom Line

Overall, even with its comparatively similar performance, worse downside risk, and higher fees, Federated MDT Small Cap Growth Fund A ( QASGX ) has a high Zacks Mutual Fund rank, and therefore looks a good potential choice for investors right now.

Your research on the Small Cap Growth 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. 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.