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Is USAA Science & Technology Fund (USSCX) a Strong Mutual Fund Pick Right Now?
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If you've been stuck searching for Sector - Tech funds, you might want to consider passing on by USAA Science & Technology Fund (USSCX - Free Report) as a possibility. USSCX holds a Zacks Mutual Fund Rank of 4 (Sell), which is based on nine forecasting factors like size, cost, and past performance.
Objective
The world of Sector - Tech funds is an area filled with options, and USSCX is one of them. Sector - Tech mutual funds allow investors to own a stake in a notoriously volatile sector with a much more diversified approach. Tech companies can be in any number of industries such as semiconductors, software, internet, networking just to name a few.
History of Fund/Manager
USSCX finds itself in the USAA Group family, based out of San Antonio, TX. USAA Science & Technology Fund debuted in August of 1997. Since then, USSCX has accumulated assets of about $1.14 billion, according to the most recently available information. A team of investment professionals is the fund's current manager.
Performance
Of course, investors look for strong performance in funds. USSCX has a 5-year annualized total return of 21.81% and it sits in the top 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 18.92%, 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. The standard deviation of USSCX over the past three years is 13.37% compared to the category average of 12.11%. The fund's standard deviation over the past 5 years is 12.37% compared to the category average of 11.45%. This makes the fund more 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 USSCX's case, the fund lost 52.59% in the most recent bear market and outperformed its peer group by 0.34%. This means that the fund could possibly be a better choice than its peers during a down market environment.
Nevertheless, investors should also note that the fund has a 5-year beta of 1.04, which means 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. USSCX has generated a positive alpha over the past five years of 4.8, demonstrating that managers in this portfolio are skilled in picking securities that generate better-than-benchmark returns.
Holdings
Investigating 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.
This fund is currently holding about 87.53% stock in stocks, with an average market capitalization of $152.99 billion. The fund has the heaviest exposure to the following market sectors:
Technology
Health
Turnover is 75%, which means, on average, the fund makes fewer trades than the average comparable fund.
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, USSCX is a no load fund. It has an expense ratio of 1.14% compared to the category average of 1.28%. Looking at the fund from a cost perspective, USSCX is actually cheaper than its peers.
Investors need to be aware that with this product, the minimum initial investment is $3,000; each subsequent investment needs to be at least $50.
Bottom Line
Overall, USAA Science & Technology Fund has a low Zacks Mutual Fund rank, and in conjunction with its comparatively strong performance, average downside risk, and lower fees, this fund looks like a somewhat weak choice for investors right now.
Don't stop here for your research on Sector - Tech funds. We also have plenty more on our site in order to help you find the best possible fund for your portfolio. Make sure to check out www.zacks.com/funds/mutual-funds for more information about the world of funds, and feel free to compare USSCX to its peers 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 USAA Science & Technology Fund (USSCX) a Strong Mutual Fund Pick Right Now?
If you've been stuck searching for Sector - Tech funds, you might want to consider passing on by USAA Science & Technology Fund (USSCX - Free Report) as a possibility. USSCX holds a Zacks Mutual Fund Rank of 4 (Sell), which is based on nine forecasting factors like size, cost, and past performance.
Objective
The world of Sector - Tech funds is an area filled with options, and USSCX is one of them. Sector - Tech mutual funds allow investors to own a stake in a notoriously volatile sector with a much more diversified approach. Tech companies can be in any number of industries such as semiconductors, software, internet, networking just to name a few.
History of Fund/Manager
USSCX finds itself in the USAA Group family, based out of San Antonio, TX. USAA Science & Technology Fund debuted in August of 1997. Since then, USSCX has accumulated assets of about $1.14 billion, according to the most recently available information. A team of investment professionals is the fund's current manager.
Performance
Of course, investors look for strong performance in funds. USSCX has a 5-year annualized total return of 21.81% and it sits in the top 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 18.92%, 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. The standard deviation of USSCX over the past three years is 13.37% compared to the category average of 12.11%. The fund's standard deviation over the past 5 years is 12.37% compared to the category average of 11.45%. This makes the fund more 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 USSCX's case, the fund lost 52.59% in the most recent bear market and outperformed its peer group by 0.34%. This means that the fund could possibly be a better choice than its peers during a down market environment.
Nevertheless, investors should also note that the fund has a 5-year beta of 1.04, which means 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. USSCX has generated a positive alpha over the past five years of 4.8, demonstrating that managers in this portfolio are skilled in picking securities that generate better-than-benchmark returns.
Holdings
Investigating 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.
This fund is currently holding about 87.53% stock in stocks, with an average market capitalization of $152.99 billion. The fund has the heaviest exposure to the following market sectors:
Turnover is 75%, which means, on average, the fund makes fewer trades than the average comparable fund.
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, USSCX is a no load fund. It has an expense ratio of 1.14% compared to the category average of 1.28%. Looking at the fund from a cost perspective, USSCX is actually cheaper than its peers.
Investors need to be aware that with this product, the minimum initial investment is $3,000; each subsequent investment needs to be at least $50.
Bottom Line
Overall, USAA Science & Technology Fund has a low Zacks Mutual Fund rank, and in conjunction with its comparatively strong performance, average downside risk, and lower fees, this fund looks like a somewhat weak choice for investors right now.
Don't stop here for your research on Sector - Tech funds. We also have plenty more on our site in order to help you find the best possible fund for your portfolio. Make sure to check out www.zacks.com/funds/mutual-funds for more information about the world of funds, and feel free to compare USSCX to its peers 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.