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Is Schwab Small-Cap Index (SWSSX) a Strong Mutual Fund Pick Right Now?
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Any investors who are searching for Mutual Fund Equity Report funds should take a look at Schwab Small-Cap Index (SWSSX - Free Report) . While this fund is not tracked by the Zacks Mutual Fund Rank, we were able to examine other factors like performance, volatility, and cost.
History of Fund/Manager
Schwab Funds is based in San Francisco, CA, and is the manager of SWSSX. The Schwab Small-Cap Index made its debut in May of 1997 and SWSSX has managed to accumulate roughly $5.37 billion in assets, as of 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. SWSSX has a 5-year annualized total return of 4.78% and it sits in the bottom 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 17.57%, which places it in the bottom 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. SWSSX's standard deviation over the past three years is 22.92% compared to the category average of 25.93%. Looking at the past 5 years, the fund's standard deviation is 23.93% compared to the category average of 23.54%. 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 1.15, so it is likely going to be more volatile than the market at large. Because alpha represents a portfolio's performance on a risk-adjusted basis relative to a benchmark, which is the S&P 500 in this case, one should pay attention to this metric as well. SWSSX's 5-year performance has produced a negative alpha of -6.25, which means managers in this portfolio find it difficult to pick securities that generate better-than-benchmark returns.
Holdings
Investigating 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 principally on equities that are traded in the United States.
Right now, 98.96% of this mutual fund's holdings are stocks, with an average market capitalization of $2.84 billion. The fund has the heaviest exposure to the following market sectors:
Finance
Industrial Cyclical
Technology
Health
Other
Turnover is 16%, which means, on average, the fund makes fewer trades than the average comparable fund.
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, SWSSX is a no load fund. It has an expense ratio of 0.04% compared to the category average of 0.79%. So, SWSSX is actually cheaper than its peers from a cost perspective.
Investors need to be aware that with this product, the minimum initial investment is $0; each subsequent investment has no minimum amount.
Bottom Line
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 SWSSX too 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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Is Schwab Small-Cap Index (SWSSX) a Strong Mutual Fund Pick Right Now?
Any investors who are searching for Mutual Fund Equity Report funds should take a look at Schwab Small-Cap Index (SWSSX - Free Report) . While this fund is not tracked by the Zacks Mutual Fund Rank, we were able to examine other factors like performance, volatility, and cost.
History of Fund/Manager
Schwab Funds is based in San Francisco, CA, and is the manager of SWSSX. The Schwab Small-Cap Index made its debut in May of 1997 and SWSSX has managed to accumulate roughly $5.37 billion in assets, as of 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. SWSSX has a 5-year annualized total return of 4.78% and it sits in the bottom 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 17.57%, which places it in the bottom 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. SWSSX's standard deviation over the past three years is 22.92% compared to the category average of 25.93%. Looking at the past 5 years, the fund's standard deviation is 23.93% compared to the category average of 23.54%. 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 1.15, so it is likely going to be more volatile than the market at large. Because alpha represents a portfolio's performance on a risk-adjusted basis relative to a benchmark, which is the S&P 500 in this case, one should pay attention to this metric as well. SWSSX's 5-year performance has produced a negative alpha of -6.25, which means managers in this portfolio find it difficult to pick securities that generate better-than-benchmark returns.
Holdings
Investigating 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 principally on equities that are traded in the United States.
Right now, 98.96% of this mutual fund's holdings are stocks, with an average market capitalization of $2.84 billion. The fund has the heaviest exposure to the following market sectors:
- Finance
- Industrial Cyclical
- Technology
- Health
- Other
Turnover is 16%, which means, on average, the fund makes fewer trades than the average comparable fund.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, SWSSX is a no load fund. It has an expense ratio of 0.04% compared to the category average of 0.79%. So, SWSSX is actually cheaper than its peers from a cost perspective.
Investors need to be aware that with this product, the minimum initial investment is $0; each subsequent investment has no minimum amount.
Bottom Line
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 SWSSX too 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.