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Is Franklin Utilities A (FKUTX) a Strong Mutual Fund Pick Right Now?
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If you've been stuck searching for Sector - Utilities funds, consider Franklin Utilities A (FKUTX - Free Report) as a possibility. FKUTX possesses a Zacks Mutual Fund Rank of 1 (Strong Buy), which is based on nine forecasting factors like size, cost, and past performance.
Objective
We classify FKUTX in the Sector - Utilities category, an area that is rife with possible choices. Sector - Utilities funds focus their investments on firms that provide essential daily services to millions of people like electric power, gas distribution, and water supply. All in all, the utility industry is a perfect fit for those investors looking for stability and low volatility.
History of Fund/Manager
Franklin Templeton is based in San Mateo, CA, and is the manager of FKUTX. The Franklin Utilities A made its debut in September of 1948 and FKUTX has managed to accumulate roughly $3.53 billion in assets, as of the most recently available information. The fund's current manager, John Kohli, has been in charge of the fund since December of 1998.
Performance
Investors naturally seek funds with strong performance. This fund in particular has delivered a 5-year annualized total return of 9.66%, and is in the top third among its category peers. But if you are looking for a shorter time frame, it is also worth looking at its 3-year annualized total return of 11.88%, 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. Over the past three years, FKUTX's standard deviation comes in at 15.32%, compared to the category average of 14.88%. The standard deviation of the fund over the past 5 years is 14.02% compared to the category average of 12.52%. This makes the fund more volatile than its peers over the past half-decade.
Risk Factors
Investors should note that the fund has a 5-year beta of 0.4, so it is likely going to be 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. The fund has produced a positive alpha over the past 5 years of 2.68, which shows that managers in this portfolio are skilled in picking securities that generate better-than-benchmark returns.
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, FKUTX is a load fund. It has an expense ratio of 0.73% compared to the category average of 1.23%. So, FKUTX is actually cheaper than its peers from a cost perspective.
This fund requires a minimum initial investment of $1,000, while there is no minimum for each subsequent investment.
Bottom Line
Overall, Franklin Utilities A ( FKUTX ) 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.
For additional information on this product, or to compare it to other mutual funds in the Sector - Utilities, make sure to go to www.zacks.com/funds/mutual-funds for additional information. For analysis of the rest of your portfolio, make sure to visit Zacks.com for our full suite of tools which will help you investigate all of your stocks and funds in one place.
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Is Franklin Utilities A (FKUTX) a Strong Mutual Fund Pick Right Now?
If you've been stuck searching for Sector - Utilities funds, consider Franklin Utilities A (FKUTX - Free Report) as a possibility. FKUTX possesses a Zacks Mutual Fund Rank of 1 (Strong Buy), which is based on nine forecasting factors like size, cost, and past performance.
Objective
We classify FKUTX in the Sector - Utilities category, an area that is rife with possible choices. Sector - Utilities funds focus their investments on firms that provide essential daily services to millions of people like electric power, gas distribution, and water supply. All in all, the utility industry is a perfect fit for those investors looking for stability and low volatility.
History of Fund/Manager
Franklin Templeton is based in San Mateo, CA, and is the manager of FKUTX. The Franklin Utilities A made its debut in September of 1948 and FKUTX has managed to accumulate roughly $3.53 billion in assets, as of the most recently available information. The fund's current manager, John Kohli, has been in charge of the fund since December of 1998.
Performance
Investors naturally seek funds with strong performance. This fund in particular has delivered a 5-year annualized total return of 9.66%, and is in the top third among its category peers. But if you are looking for a shorter time frame, it is also worth looking at its 3-year annualized total return of 11.88%, 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. Over the past three years, FKUTX's standard deviation comes in at 15.32%, compared to the category average of 14.88%. The standard deviation of the fund over the past 5 years is 14.02% compared to the category average of 12.52%. This makes the fund more volatile than its peers over the past half-decade.
Risk Factors
Investors should note that the fund has a 5-year beta of 0.4, so it is likely going to be 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. The fund has produced a positive alpha over the past 5 years of 2.68, which shows that managers in this portfolio are skilled in picking securities that generate better-than-benchmark returns.
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, FKUTX is a load fund. It has an expense ratio of 0.73% compared to the category average of 1.23%. So, FKUTX is actually cheaper than its peers from a cost perspective.
This fund requires a minimum initial investment of $1,000, while there is no minimum for each subsequent investment.
Bottom Line
Overall, Franklin Utilities A ( FKUTX ) 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.
For additional information on this product, or to compare it to other mutual funds in the Sector - Utilities, make sure to go to www.zacks.com/funds/mutual-funds for additional information. For analysis of the rest of your portfolio, make sure to visit Zacks.com for our full suite of tools which will help you investigate all of your stocks and funds in one place.