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Is American Funds AMCAP A (AMCPX) a Strong Mutual Fund Pick Right Now?
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If investors are looking at the Large Cap Growth fund category, American Funds AMCAP A (AMCPX - Free Report) could be a potential option. AMCPX bears a Zacks Mutual Fund Rank of 2 (Buy), which is based on nine forecasting factors like size, cost, and past performance.
Objective
We classify AMCPX in the Large Cap Growth category, an area rife with potential choices. Large Cap Growth funds invest in many large U.S. companies that are expected to grow much faster compared to other large-cap stocks. To be considered large-cap, companies must have a market cap over $10 billion.
History of Fund/Manager
American Funds is responsible for AMCPX, and the company is based out of Los Angeles, CA. American Funds AMCAP A made its debut in May of 1967, and since then, AMCPX has accumulated about $32.02 billion in assets, per the most up-to-date date available. The fund's current manager is a team of investment professionals.
Performance
Investors naturally seek funds with strong performance. This fund has delivered a 5-year annualized total return of 8.93%, and is in the bottom third among its category peers. Investors who prefer analyzing shorter time frames should look at its 3-year annualized total return of 13.56%, which places it in the bottom 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. Over the past three years, AMCPX's standard deviation comes in at 11.08%, compared to the category average of 9.09%. The fund's standard deviation over the past 5 years is 11.79% compared to the category average of 9.44%. 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. AMCPX lost 48.63% in the most recent bear market and outperformed its peer group by 0.23%. This could mean that the fund is a better choice than comparable funds during a bear market.
Nevertheless, investors should also note that the fund has a 5-year beta of 0.99, which means it is hypothetically as volatile as 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 -1.62, 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.
Right now, 91.67% of this mutual fund's holdings are stocks, and these companies have an average market capitalization of $140.60 billion. The fund has the heaviest exposure to the following market sectors:
Technology
Other
With turnover at about 27%, this fund is making fewer trades than comparable funds.
Expenses
Costs are increasingly important for mutual fund investing, and particularly as competition heats up in this market. And all things being equal, a lower cost product will outperform its otherwise identical counterpart, so taking a closer look at these metrics is key for investors. In terms of fees, AMCPX is a load fund. It has an expense ratio of 0.65% compared to the category average of 1.06%. AMCPX is actually cheaper than its peers when you consider factors like cost.
Investors need to be aware that with this product, the minimum initial investment is $250; each subsequent investment needs to be at least $50.
Bottom Line
Overall, American Funds AMCAP A ( AMCPX ) has a high Zacks Mutual Fund rank, weak performance, average downside risk, and lower fees compared to its peers.
For additional information on the Large 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 AMCPX too 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 AMCAP A (AMCPX) a Strong Mutual Fund Pick Right Now?
If investors are looking at the Large Cap Growth fund category, American Funds AMCAP A (AMCPX - Free Report) could be a potential option. AMCPX bears a Zacks Mutual Fund Rank of 2 (Buy), which is based on nine forecasting factors like size, cost, and past performance.
Objective
We classify AMCPX in the Large Cap Growth category, an area rife with potential choices. Large Cap Growth funds invest in many large U.S. companies that are expected to grow much faster compared to other large-cap stocks. To be considered large-cap, companies must have a market cap over $10 billion.
History of Fund/Manager
American Funds is responsible for AMCPX, and the company is based out of Los Angeles, CA. American Funds AMCAP A made its debut in May of 1967, and since then, AMCPX has accumulated about $32.02 billion in assets, per the most up-to-date date available. The fund's current manager is a team of investment professionals.
Performance
Investors naturally seek funds with strong performance. This fund has delivered a 5-year annualized total return of 8.93%, and is in the bottom third among its category peers. Investors who prefer analyzing shorter time frames should look at its 3-year annualized total return of 13.56%, which places it in the bottom 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. Over the past three years, AMCPX's standard deviation comes in at 11.08%, compared to the category average of 9.09%. The fund's standard deviation over the past 5 years is 11.79% compared to the category average of 9.44%. 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. AMCPX lost 48.63% in the most recent bear market and outperformed its peer group by 0.23%. This could mean that the fund is a better choice than comparable funds during a bear market.
Nevertheless, investors should also note that the fund has a 5-year beta of 0.99, which means it is hypothetically as volatile as 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 -1.62, 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.
Right now, 91.67% of this mutual fund's holdings are stocks, and these companies have an average market capitalization of $140.60 billion. The fund has the heaviest exposure to the following market sectors:
- Technology
- Other
With turnover at about 27%, this fund is making fewer trades than comparable funds.Expenses
Costs are increasingly important for mutual fund investing, and particularly as competition heats up in this market. And all things being equal, a lower cost product will outperform its otherwise identical counterpart, so taking a closer look at these metrics is key for investors. In terms of fees, AMCPX is a load fund. It has an expense ratio of 0.65% compared to the category average of 1.06%. AMCPX is actually cheaper than its peers when you consider factors like cost.
Investors need to be aware that with this product, the minimum initial investment is $250; each subsequent investment needs to be at least $50.
Bottom Line
Overall, American Funds AMCAP A ( AMCPX ) has a high Zacks Mutual Fund rank, weak performance, average downside risk, and lower fees compared to its peers.
For additional information on the Large 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 AMCPX too 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.