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Is DFA US Large Cap Value Institutional (DFLVX) a Strong Mutual Fund Pick Right Now?

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If you're looking for a Mutual Fund Equity Report fund category, then a potential option is DFA US Large Cap Value Institutional (DFLVX - Free Report) . DFLVX 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

Dimensional is based in Austin, TX, and is the manager of DFLVX. DFA US Large Cap Value Institutional debuted in February of 1993. Since then, DFLVX has accumulated assets of about $25.31 billion, according to the most recently available information. The fund's current manager is a team of investment professionals.

Performance

Of course, investors look for strong performance in funds. This fund carries a 5-year annualized total return of 6.78%, 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 6.97%, 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. DFLVX's standard deviation over the past three years is 22.26% compared to the category average of 19.2%. Looking at the past 5 years, the fund's standard deviation is 19.85% compared to the category average of 17.2%. This makes the fund more volatile than its peers over the past half-decade.

Risk Factors

Investors should not forget about beta, an important way to measure a mutual fund's risk compared to the market as a whole. DFLVX has a 5-year beta of 1.07, which means it is likely to be more 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. With a negative alpha of -4.33, 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.

Currently, this mutual fund is holding 96.68% stock in stocks and it has a negligible amount of assets in foreign securities. Turnover is 0%, which means this fund makes fewer trades than comparable funds.

Expenses

As competition heats up in the mutual fund market, costs become increasingly important. Compared to its otherwise identical counterpart, a low-cost product will be an outperformer, all other things being equal. Thus, taking a closer look at cost-related metrics is vital for investors. In terms of fees, DFLVX is a no load fund. It has an expense ratio of 0.23% compared to the category average of 0.99%. DFLVX is actually cheaper than its peers when you consider factors like cost.

While the minimum initial investment for the product is $0, investors should also note that there is no minimum for each subsequent investment.

Bottom Line

Overall, DFA US Large Cap Value Institutional ( DFLVX ) has a neutral Zacks Mutual Fund rank, and in conjunction with its comparatively similar performance, average downside risk, and lower fees, DFA US Large Cap Value Institutional ( DFLVX ) looks like a somewhat average choice for investors right now.

For additional information on this product, or to compare it to other mutual funds in the Mutual Fund Equity Report, make sure to go to www.zacks.com/funds/mutual-funds 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.


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