Large Cap Value fund seekers should consider taking a look at American Beacon London Company Income Equity Y (ABCYX Quick QuoteABCYX - Free Report) . ABCYX carries a Zacks Mutual Fund Rank of 1 (Strong Buy), which is based on nine forecasting factors like size, cost, and past performance.

Objective

ABCYX is one of many Large Cap Value mutual funds to choose from. These funds invest in equities with a market capitalization of $10 billion or more, but whose share prices do not reflect their intrinsic value. This strategy can often produce low P/E ratios and high dividend yields; growth levels; however, growth levels are oftentimes cut back. These funds'high growth opportunities are slowed even more since large-cap stocks are usually in more stable industries with low to moderate growth prospects. Thus, investors interested in a stable income stream fund Large Cap Value funds very appealing.

History of Fund/Manager

ABCYX is a part of the American Beacon family of funds, a company based out of Irving, TX. Since American Beacon London Company Income Equity Y made its debut in May of 2012, ABCYX has garnered more than $559.07 million in assets. The fund is currently managed by a team of investment professionals.

Performance

Obviously, what investors are looking for in these funds is strong performance relative to their peers. ABCYX has a 5-year annualized total return of 3.88% and is 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 2.25%, 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 ABCYX over the past three years is 14.31% compared to the category average of 10.66%. The fund's standard deviation over the past 5 years is 12.78% compared to the category average of 10.46%. This makes the fund more volatile than its peers over the past half-decade.

Risk Factors

One cannot ignore the volatility of this segment, however, as it is always important for investors to remember the downside to any potential investment.

Investors should not forget about beta, an important way to measure a mutual fund's risk compared to the market as a whole. ABCYX has a 5-year beta of 0.9, which means it is likely to be less volatile than the market average. 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. ABCYX has generated a negative alpha over the past five years of -2.19, demonstrating that managers in this portfolio find it difficult to pick 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 principally on equities that are traded in the United States.

The mutual fund currently has 96.47% of its holdings in stocks, with an average market capitalization of $245.07 billion. The fund has the heaviest exposure to the following market sectors:

1. Technology
2. Finance
3. Industrial Cyclical
4. Non-Durable

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, ABCYX is a no load fund. It has an expense ratio of 0.80% compared to the category average of 1%. So, ABCYX is actually cheaper than its peers from a cost perspective.

This fund requires a minimum initial investment of $100,000, and each subsequent investment should be at least $50.

Bottom Line

Overall, American Beacon London Company Income Equity Y ( ABCYX ) has a high Zacks Mutual Fund rank, and in conjunction with its comparatively strong performance, average downside risk, and lower fees, this fund looks like a good potential choice for investors right now.

Your research on the Large Cap Value 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. Zacks provides a full suite of tools to help you analyze your portfolio - both funds and stocks - in the most efficient way possible.