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Is Brown Advisory Flexible Equity Investor (BIAFX) a Strong Mutual Fund Pick Right Now?

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Any investors hoping to find an Allocation Balanced fund could think about starting with Brown Advisory Flexible Equity Investor (BIAFX - Free Report) . BIAFX has a Zacks Mutual Fund Rank of 3 (Hold), which is based on nine forecasting factors like size, cost, and past performance.

Objective

BIAFX is classified in the Allocation Balanced segment by Zacks, which is an area full of possibilities. Here, investors are able to get a good head start with diversified mutual funds, and play around with core holding options for a portfolio of funds. Allocation Balanced funds look to invest across a balance of asset types, like stocks, bonds, and cash, though including precious metals or commodities is not unusual; these funds are mostly categorized by their respective asset allocation.

History of Fund/Manager

BIAFX is a part of the Brown Adv Fds family of funds, a company based out of Baltimore, MD. Brown Advisory Flexible Equity Investor made its debut in December of 2006, and since then, BIAFX has accumulated about $500.28 million in assets, per the most up-to-date date available. Maneesh Bajaj is the fund's current manager and has held that role since October of 2017.

Performance

Obviously, what investors are looking for in these funds is strong performance relative to their peers. This fund carries a 5-year annualized total return of 20.69%, 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 20.57%, which places it in the middle 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 BIAFX over the past three years is 20.18% compared to the category average of 16.66%. The fund's standard deviation over the past 5 years is 16.51% compared to the category average of 13.81%. This makes the fund more volatile than its peers over the past half-decade.

Risk Factors

The fund has a 5-year beta of 1.08, so investors should note that it is hypothetically more volatile than 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. Over the past 5 years, the fund has a positive alpha of 1.53. This means that managers in this portfolio are skilled in picking 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 mostly on equities that are traded in the United States.

Right now, 84.81% of this mutual fund's holdings are stocks, which have an average market capitalization of $375.15 billion. The fund has the heaviest exposure to the following market sectors:

  1. Technology
  2. Finance
  3. Retail Trade
This fund's turnover is about 24%, so the fund managers are making fewer trades than the average comparable fund.

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, BIAFX is a no load fund. It has an expense ratio of 0.70% compared to the category average of 0.89%. BIAFX is actually cheaper than its peers when you consider factors like cost.

Investors should also note that the minimum initial investment for the product is $100 and that each subsequent investment needs to be at $100.

Bottom Line

Overall, Brown Advisory Flexible Equity Investor ( BIAFX ) has a neutral Zacks Mutual Fund rank, and in conjunction with its comparatively similar performance, average downside risk, and lower fees, this fund looks like a somewhat average choice for investors right now.

Your research on the Allocation Balanced 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. 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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