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Is Virtus KAR Small Cap Sustain Growth A (PSGAX) a Strong Mutual Fund Pick Right Now?
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If you have been looking for Small Cap Growth funds, it would not be wise to start your search with Virtus KAR Small Cap Sustain Growth A (PSGAX - Free Report) . PSGAX holds a Zacks Mutual Fund Rank of 5 (Strong Sell), which is based on nine forecasting factors like size, cost, and past performance.
Objective
PSGAX is one of many different Small Cap Growth funds to choose from. Small Cap Growth mutual funds build portfolios around stocks with markets caps under $2 billion and large growth opportunities. Additionally, these portfolios typically highlight smaller companies in promising markets and industries.
History of Fund/Manager
PSGAX finds itself in the Virtus Funds family, based out of Hartford, CT. Since Virtus KAR Small Cap Sustain Growth A made its debut in June of 2006, PSGAX has garnered more than $387.07 million in assets. The fund's current manager, Todd Beiley, has been in charge of the fund since April of 2008.
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 19.56%, and it sits in the top third among its category peers. Investors who prefer analyzing shorter time frames should look at its 3-year annualized total return of 25.98%, 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. Compared to the category average of 10.38%, the standard deviation of PSGAX over the past three years is 12.64%. Looking at the past 5 years, the fund's standard deviation is 12.62% compared to the category average of 10.25%. This makes the fund more volatile than its peers over the past half-decade.
Risk Factors
It's always important to be aware of the downsides to any future investment, so one should not discount the risks that come with this segment. PSGAX lost 49.54% in the most recent bear market and underperformed comparable funds by 3.6%. This means that the fund could possibly be a worse choice than its peers during a down market environment.
Nevertheless, investors should also note that the fund has a 5-year beta of 0.91, which means it is hypothetically less volatile than the market at large. Another factor to consider is alpha, as it reflects a portfolio's performance on a risk-adjusted basis relative to a benchmark-in this case, the S&P 500. With a positive alpha of 7.24, 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 primarily on equities that are traded in the United States.
Currently, this mutual fund is holding 85% stock in stocks, with an average market capitalization of $5.29 billion. The fund has the heaviest exposure to the following market sectors:
Technology
Other
Turnover is 20%, which means this fund makes fewer trades than its comparable peers.
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, PSGAX is a load fund. It has an expense ratio of 1.37% compared to the category average of 1.31%. From a cost perspective, PSGAX is actually more expensive than its peers.
This fund requires a minimum initial investment of $2,500, and each subsequent investment should be at least $100.
Bottom Line
Overall, Virtus KAR Small Cap Sustain Growth A has a low Zacks Mutual Fund rank, and in conjunction with its comparatively strong performance, average downside risk, and higher fees, this fund looks like a poor potential choice for investors right now.
For additional information on the Small Cap Growth area of the mutual fund world, make sure to check out www.zacks.com/funds/mutual-funds. There, you can see more about the ranking process, and dive even deeper into PSGAX too 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.
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Is Virtus KAR Small Cap Sustain Growth A (PSGAX) a Strong Mutual Fund Pick Right Now?
If you have been looking for Small Cap Growth funds, it would not be wise to start your search with Virtus KAR Small Cap Sustain Growth A (PSGAX - Free Report) . PSGAX holds a Zacks Mutual Fund Rank of 5 (Strong Sell), which is based on nine forecasting factors like size, cost, and past performance.
Objective
PSGAX is one of many different Small Cap Growth funds to choose from. Small Cap Growth mutual funds build portfolios around stocks with markets caps under $2 billion and large growth opportunities. Additionally, these portfolios typically highlight smaller companies in promising markets and industries.
History of Fund/Manager
PSGAX finds itself in the Virtus Funds family, based out of Hartford, CT. Since Virtus KAR Small Cap Sustain Growth A made its debut in June of 2006, PSGAX has garnered more than $387.07 million in assets. The fund's current manager, Todd Beiley, has been in charge of the fund since April of 2008.
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 19.56%, and it sits in the top third among its category peers. Investors who prefer analyzing shorter time frames should look at its 3-year annualized total return of 25.98%, 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. Compared to the category average of 10.38%, the standard deviation of PSGAX over the past three years is 12.64%. Looking at the past 5 years, the fund's standard deviation is 12.62% compared to the category average of 10.25%. This makes the fund more volatile than its peers over the past half-decade.
Risk Factors
It's always important to be aware of the downsides to any future investment, so one should not discount the risks that come with this segment. PSGAX lost 49.54% in the most recent bear market and underperformed comparable funds by 3.6%. This means that the fund could possibly be a worse choice than its peers during a down market environment.
Nevertheless, investors should also note that the fund has a 5-year beta of 0.91, which means it is hypothetically less volatile than the market at large. Another factor to consider is alpha, as it reflects a portfolio's performance on a risk-adjusted basis relative to a benchmark-in this case, the S&P 500. With a positive alpha of 7.24, 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 primarily on equities that are traded in the United States.
Currently, this mutual fund is holding 85% stock in stocks, with an average market capitalization of $5.29 billion. The fund has the heaviest exposure to the following market sectors:
Turnover is 20%, which means this fund makes fewer trades than its comparable peers.
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, PSGAX is a load fund. It has an expense ratio of 1.37% compared to the category average of 1.31%. From a cost perspective, PSGAX is actually more expensive than its peers.
This fund requires a minimum initial investment of $2,500, and each subsequent investment should be at least $100.
Bottom Line
Overall, Virtus KAR Small Cap Sustain Growth A has a low Zacks Mutual Fund rank, and in conjunction with its comparatively strong performance, average downside risk, and higher fees, this fund looks like a poor potential choice for investors right now.
For additional information on the Small Cap Growth area of the mutual fund world, make sure to check out www.zacks.com/funds/mutual-funds. There, you can see more about the ranking process, and dive even deeper into PSGAX too 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.