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Is American Funds Fundamentl Invs A (ANCFX) a Strong Mutual Fund Pick Right Now?
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Large Cap Blend fund seekers should consider taking a look at American Funds Fundamentl Invs A (ANCFX - Free Report) . ANCFX possesses a Zacks Mutual Fund Rank of 1 (Strong Buy), which is based on nine forecasting factors like size, cost, and past performance.
Objective
ANCFX is part of the Large Cap Blend section, an area that boasts an array of many possible options. Large Cap Blend mutual funds most often invest in firms with a market capitalization of $10 billion or more. By investing in bigger companies, these funds offer more stability, and are often well-suited for investors with a " buy and hold " mindset. Blended funds mix large, established companies into their holdings, which gives investors exposure to both value and growth at the same time.
History of Fund/Manager
American Funds is based in Los Angeles, CA, and is the manager of ANCFX. American Funds Fundamentl Invs A made its debut in July of 1978, and since then, ANCFX has accumulated about $50.20 billion in assets, per the most up-to-date date available. A team of investment professionals is the fund's current manager.
Performance
Investors naturally seek funds with strong performance. This fund in particular has delivered a 5-year annualized total return of 15.14%, and is 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 11.68%, which places it in the top 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. ANCFX's standard deviation over the past three years is 10.39% compared to the category average of 8.79%. The standard deviation of the fund over the past 5 years is 9.7% compared to the category average of 9.86%. This makes the fund less volatile than its peers over the past half-decade.
Risk Factors
Investors should always remember the downsides to a potential investment, and this segment carries some risks one should be aware of. In ANCFX's case, the fund lost 50.06% in the most recent bear market and underperformed its peer group by 0.49%. This could mean that the fund is a worse choice than comparable funds during a bear market.
Nevertheless, investors should also note that the fund has a 5-year beta of 1, which means it is hypothetically as volatile as 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. ANCFX has generated a positive alpha over the past five years of 0.03, demonstrating that managers in this portfolio are skilled in picking 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 largely on equities that are traded in the United States.
Right now, 94.23% of this mutual fund's holdings are stocks, which have an average market capitalization of $180.82 billion. The fund has the heaviest exposure to the following market sectors:
Technology
Finance
Industrial Cyclical
Non-Durable
With turnover at about 34%, this fund is making 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, ANCFX is a load fund. It has an expense ratio of 0.60% compared to the category average of 1.03%. From a cost perspective, ANCFX is actually cheaper than its peers.
This fund requires a minimum initial investment of $250, and each subsequent investment should be at least $50.
Bottom Line
Overall, American Funds Fundamentl Invs A ANCFX has a high Zacks Mutual Fund rank, and in conjunction with its comparatively similar performance, average downside risk, and lower fees, American Funds Fundamentl Invs A looks like a good potential choice for investors right now.
This could just be the start of your research on ANCFXin the Large Cap Blend 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. If you want to check out our stock reports as well, make sure to go to Zacks.com to see all of the great tools we have to offer, including our time-tested Zacks Rank.
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Is American Funds Fundamentl Invs A (ANCFX) a Strong Mutual Fund Pick Right Now?
Large Cap Blend fund seekers should consider taking a look at American Funds Fundamentl Invs A (ANCFX - Free Report) . ANCFX possesses a Zacks Mutual Fund Rank of 1 (Strong Buy), which is based on nine forecasting factors like size, cost, and past performance.
Objective
ANCFX is part of the Large Cap Blend section, an area that boasts an array of many possible options. Large Cap Blend mutual funds most often invest in firms with a market capitalization of $10 billion or more. By investing in bigger companies, these funds offer more stability, and are often well-suited for investors with a " buy and hold " mindset. Blended funds mix large, established companies into their holdings, which gives investors exposure to both value and growth at the same time.
History of Fund/Manager
American Funds is based in Los Angeles, CA, and is the manager of ANCFX. American Funds Fundamentl Invs A made its debut in July of 1978, and since then, ANCFX has accumulated about $50.20 billion in assets, per the most up-to-date date available. A team of investment professionals is the fund's current manager.
Performance
Investors naturally seek funds with strong performance. This fund in particular has delivered a 5-year annualized total return of 15.14%, and is 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 11.68%, which places it in the top 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. ANCFX's standard deviation over the past three years is 10.39% compared to the category average of 8.79%. The standard deviation of the fund over the past 5 years is 9.7% compared to the category average of 9.86%. This makes the fund less volatile than its peers over the past half-decade.
Risk Factors
Investors should always remember the downsides to a potential investment, and this segment carries some risks one should be aware of. In ANCFX's case, the fund lost 50.06% in the most recent bear market and underperformed its peer group by 0.49%. This could mean that the fund is a worse choice than comparable funds during a bear market.
Nevertheless, investors should also note that the fund has a 5-year beta of 1, which means it is hypothetically as volatile as 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. ANCFX has generated a positive alpha over the past five years of 0.03, demonstrating that managers in this portfolio are skilled in picking 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 largely on equities that are traded in the United States.
Right now, 94.23% of this mutual fund's holdings are stocks, which have an average market capitalization of $180.82 billion. The fund has the heaviest exposure to the following market sectors:
With turnover at about 34%, this fund is making 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, ANCFX is a load fund. It has an expense ratio of 0.60% compared to the category average of 1.03%. From a cost perspective, ANCFX is actually cheaper than its peers.
This fund requires a minimum initial investment of $250, and each subsequent investment should be at least $50.
Bottom Line
Overall, American Funds Fundamentl Invs A ANCFX has a high Zacks Mutual Fund rank, and in conjunction with its comparatively similar performance, average downside risk, and lower fees, American Funds Fundamentl Invs A looks like a good potential choice for investors right now.
This could just be the start of your research on ANCFXin the Large Cap Blend 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. If you want to check out our stock reports as well, make sure to go to Zacks.com to see all of the great tools we have to offer, including our time-tested Zacks Rank.