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Is Virtus KAR Small Cap Sustain Growth I (PXSGX) a Strong Mutual Fund Pick Right Now?

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If you have been looking for Small Cap Growth funds, a place to start could be Virtus KAR Small Cap Sustain Growth I (PXSGX - Free Report) . PXSGX carries a Zacks Mutual Fund Rank of 2 (Buy), which is based on nine forecasting factors like size, cost, and past performance.

Objective

The world of Small Cap Growth funds is an area filled with options, such as PXSGX. These funds tend to create their portfolios around stocks that sport large growth opportunities and market capitalization of less than $2 billion. The companies in these portfolios are usually on the smaller side, and are in up-and-coming industries and markets.

History of Fund/Manager

Virtus Funds is responsible for PXSGX, and the company is based out of Hartford, CT. Virtus KAR Small Cap Sustain Growth I made its debut in June of 2006, and since then, PXSGX has accumulated about $5.57 billion in assets, per the most up-to-date date available. The fund is currently managed by Todd Beiley who has been in charge of the fund since April of 2008.

Performance

Of course, investors look for strong performance in funds. This fund carries a 5-year annualized total return of 27.98%, and is in the top 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 22.53%, 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 PXSGX over the past three years is 20.91% compared to the category average of 17.7%. Looking at the past 5 years, the fund's standard deviation is 16.86% compared to the category average of 14.51%. 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 0.87, 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. PXSGX's 5-year performance has produced a positive alpha of 11.18, which means managers in this portfolio are skilled in picking securities that generate better-than-benchmark returns.

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, PXSGX is a no load fund. It has an expense ratio of 1.07% compared to the category average of 1.21%. PXSGX 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 $100,000 and that each subsequent investment has no minimum amount.

Bottom Line

Overall, Virtus KAR Small Cap Sustain Growth I ( PXSGX ) 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 the Small 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 PXSGX too 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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