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Is Hartford Small Company HLS IB (HDMBX) a Strong Mutual Fund Pick Right Now?

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If investors are looking at the Small Cap Growth fund category, Hartford Small Company HLS IB (HDMBX - Free Report) could be a potential option. HDMBX bears a Zacks Mutual Fund Rank of 1 (Strong Buy), which is based on various forecasting factors like size, cost, and past performance.

Objective

The world of Small Cap Growth funds is an area filled with options, such as HDMBX. 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

Hartford is responsible for HDMBX, and the company is based out of Woodbury, MN. The Hartford Small Company HLS IB made its debut in October of 2002 and HDMBX has managed to accumulate roughly $40.58 million in assets, as of the most recently available information. Ranjit Ramachandran is the fund's current manager and has held that role since February of 2020.

Performance

Investors naturally seek funds with strong performance. HDMBX has a 5-year annualized total return of 9.72% and is in the middle third among its category peers. Investors who prefer analyzing shorter time frames should look at its 3-year annualized total return of -2.74%, which places it in the bottom third during this time-frame.

It is important to note that the product's returns may not reflect all its expenses. Any fees not reflected would lower the returns. Total returns do not reflect the fund's [%] sale charge. If sales charges were included, total returns would have been lower.

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. Compared to the category average of 18.33%, the standard deviation of HDMBX over the past three years is 22%. The fund's standard deviation over the past 5 years is 23.96% compared to the category average of 19.46%. This makes the fund more volatile than its peers over the past half-decade.

Risk Factors

The fund has a 5-year beta of 1.14, so investors should note that it is hypothetically more 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. HDMBX has generated a negative alpha over the past five years of -6.15, demonstrating that managers in this portfolio find it difficult to pick securities that generate better-than-benchmark returns.

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, HDMBX is a no load fund. It has an expense ratio of 1.05% compared to the category average of 1.06%. Looking at the fund from a cost perspective, HDMBX is actually cheaper than its peers.

Investors should also note, that according to our data, the fund does not have any minimum investment requirements.

Fees charged by investment advisors have not been taken into considiration. Returns would be less if those were included.

Bottom Line

Overall, Hartford Small Company HLS IB ( HDMBX ) has a high Zacks Mutual Fund rank, and in conjunction with its comparatively similar performance, average downside risk, and lower fees, this fund looks like a great potential choice for investors right now.

Don't stop here for your research on Small Cap Growth funds. We also have plenty more on our site in order to help you find the best possible fund for your portfolio. Make sure to check out www.zacks.com/funds/mutual-funds for more information about the world of funds, and feel free to compare HDMBX to its peers 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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