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Is Dreyfus Select Managers Small Cap Growth I (DSGIX) a Strong Mutual Fund Pick Right Now?

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Mutual Fund Equity Report fund seekers may want to consider taking a look at Dreyfus Select Managers Small Cap Growth I (DSGIX - Free Report) . DSGIX carries a Zacks Mutual Fund Rank of 3 (Hold), which is based on nine forecasting factors like size, cost, and past performance.

History of Fund/Manager

BNY Mellon is based in New York, NY, and is the manager of DSGIX. Dreyfus Select Managers Small Cap Growth I debuted in July of 2010. Since then, DSGIX has accumulated assets of about $16.27 million, according to the most recently available information. A team of investment professionals is the fund's current manager.

Performance

Obviously, what investors are looking for in these funds is strong performance relative to their peers. This fund in particular has delivered a 5-year annualized total return of 13.2%, and it sits in the middle 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 13.3%, 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. Over the past three years, DSGIX's standard deviation comes in at 22.18%, compared to the category average of 16.93%. The fund's standard deviation over the past 5 years is 20.23% compared to the category average of 15.09%. This makes the fund more volatile than its peers over the past half-decade.

Risk Factors

The fund has a 5-year beta of 1.1, 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 negative alpha of -3.13. This means 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 primarily on equities that are traded in the United States.

Right now, 98.03% of this mutual fund's holdings are stocks, and these companies have an average market capitalization of $5.54 billion. The fund has the heaviest exposure to the following market sectors:

  1. Technology
  2. Industrial Cyclical
  3. Other
With turnover at about 112.92%, this fund is making more trades in a given year than the category average.

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, DSGIX is a no load fund. It has an expense ratio of 0.98% compared to the category average of 1.19%. From a cost perspective, DSGIX is actually cheaper than its peers.

Investors need to be aware that with this product, the minimum initial investment is $1,000; each subsequent investment needs to be at least $100.

Bottom Line

Overall, Dreyfus Select Managers Small Cap Growth I ( DSGIX ) has a neutral Zacks Mutual Fund rank, and in conjunction with its comparatively similar performance, worse downside risk, and lower fees, Dreyfus Select Managers Small Cap Growth I ( DSGIX ) looks like a somewhat average choice for investors right now.

For additional information on the Mutual Fund Equity Report 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 DSGIX too for additional information. If you are more of a stock investor, make sure to also check out our Zacks Rank, and our full suite of tools we have available for novice and professional investors alike.


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