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Is Scout Mid Cap Fund (UMBMX) a Strong Mutual Fund Pick Right Now?
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If you have been looking for Mid Cap Growth funds, it would not be wise to start your search with Scout Mid Cap Fund (UMBMX - Free Report) . UMBMX possesses a Zacks Mutual Fund Rank of 5 (Strong Sell), which is based on nine forecasting factors like size, cost, and past performance.
Objective
UMBMX is part of the Mid Cap Growth section, a segment that boasts a wide array of possible selections. While Mid Cap Growth mutual funds choose companies with a stock market valuation between $2 billion and $10 billion, stocks in these funds are also expected to show broad considerable growth opportunities for investors compared to their peers. To be considered a growth stock, companies must consistently report impressive sales and/or earnings growth.
History of Fund/Manager
Eagle Funds is based in St. Petersburg, FL, and is the manager of UMBMX. Since Scout Mid Cap Fund made its debut in November of 2006, UMBMX has garnered more than $2.66 billion in assets. The fund is currently managed by a team of investment professionals.
Performance
Of course, investors look for strong performance in funds. This fund in particular has delivered a 5-year annualized total return of 9.21%, and is 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 14.71%, 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. The standard deviation of UMBMX over the past three years is 12.93% compared to the category average of 13.59%. The standard deviation of the fund over the past 5 years is 12.35% compared to the category average of 13.11%. This makes the fund less volatile than its peers over the past half-decade.
Risk Factors
Investors cannot discount the risks to this segment though, as it is always important to remember the downside for any potential investment. In UMBMX's case, the fund lost 46.04% in the most recent bear market and outperformed its peer group by 5.63%. This makes the fund a possibly better choice than its peers during a sliding market environment.
Investors should not forget about beta, an important way to measure a mutual fund's risk compared to the market as a whole. UMBMX has a 5-year beta of 0.99, which means it is likely to be as volatile as the market average. 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. With a negative alpha of -1.31, managers in this portfolio find it difficult to pick securities that generate better-than-benchmark returns.
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, UMBMX is a no load fund. It has an expense ratio of 0.97% compared to the category average of 1.18%. From a cost perspective, UMBMX is actually cheaper than its peers.
Investors need to be aware that with this product, the minimum initial investment is $10,000; each subsequent investment has no minimum amount.
Bottom Line
Overall, Scout Mid Cap Fund ( UMBMX ) has a low Zacks Mutual Fund rank, similar performance, average downside risk, and lower fees compared to its peers.
Your research on the Mid 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. 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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Is Scout Mid Cap Fund (UMBMX) a Strong Mutual Fund Pick Right Now?
If you have been looking for Mid Cap Growth funds, it would not be wise to start your search with Scout Mid Cap Fund (UMBMX - Free Report) . UMBMX possesses a Zacks Mutual Fund Rank of 5 (Strong Sell), which is based on nine forecasting factors like size, cost, and past performance.
Objective
UMBMX is part of the Mid Cap Growth section, a segment that boasts a wide array of possible selections. While Mid Cap Growth mutual funds choose companies with a stock market valuation between $2 billion and $10 billion, stocks in these funds are also expected to show broad considerable growth opportunities for investors compared to their peers. To be considered a growth stock, companies must consistently report impressive sales and/or earnings growth.
History of Fund/Manager
Eagle Funds is based in St. Petersburg, FL, and is the manager of UMBMX. Since Scout Mid Cap Fund made its debut in November of 2006, UMBMX has garnered more than $2.66 billion in assets. The fund is currently managed by a team of investment professionals.
Performance
Of course, investors look for strong performance in funds. This fund in particular has delivered a 5-year annualized total return of 9.21%, and is 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 14.71%, 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. The standard deviation of UMBMX over the past three years is 12.93% compared to the category average of 13.59%. The standard deviation of the fund over the past 5 years is 12.35% compared to the category average of 13.11%. This makes the fund less volatile than its peers over the past half-decade.
Risk Factors
Investors cannot discount the risks to this segment though, as it is always important to remember the downside for any potential investment. In UMBMX's case, the fund lost 46.04% in the most recent bear market and outperformed its peer group by 5.63%. This makes the fund a possibly better choice than its peers during a sliding market environment.
Investors should not forget about beta, an important way to measure a mutual fund's risk compared to the market as a whole. UMBMX has a 5-year beta of 0.99, which means it is likely to be as volatile as the market average. 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. With a negative alpha of -1.31, managers in this portfolio find it difficult to pick securities that generate better-than-benchmark returns.
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, UMBMX is a no load fund. It has an expense ratio of 0.97% compared to the category average of 1.18%. From a cost perspective, UMBMX is actually cheaper than its peers.
Investors need to be aware that with this product, the minimum initial investment is $10,000; each subsequent investment has no minimum amount.
Bottom Line
Overall, Scout Mid Cap Fund ( UMBMX ) has a low Zacks Mutual Fund rank, similar performance, average downside risk, and lower fees compared to its peers.
Your research on the Mid 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. 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.