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Is MFS Technology Fund A (MTCAX) a Strong Mutual Fund Pick Right Now?
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Having trouble finding a Sector - Tech fund? Well, MFS Technology Fund A (MTCAX - Free Report) would not be a good potential starting point right now. MTCAX possesses a Zacks Mutual Fund Rank of 4 (Sell), which is based on various forecasting factors like size, cost, and past performance.
Objective
MTCAX is part of the Sector - Tech category, which boasts an array of different possible selections. With a much more diversified approach, Sector - Tech mutual funds give investors a way to own a stake in a notoriously risky sector. Tech companies are in various industries like semiconductors, software, internet, and networking, among others.
History of Fund/Manager
MFS is based in Boston, MA, and is the manager of MTCAX. MFS Technology Fund A debuted in January of 1997. Since then, MTCAX has accumulated assets of about $1 billion, according to the most recently available information. Reiner Dobbelmann is the fund's current manager and has held that role since May of 2022.
Performance
Obviously, what investors are looking for in these funds is strong performance relative to their peers. This fund carries a 5-year annualized total return of 17.47%, and it sits 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 9.78%, which places it in the top 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. MTCAX's standard deviation over the past three years is 22.68% compared to the category average of 15.56%. The fund's standard deviation over the past 5 years is 21.91% compared to the category average of 16.37%. 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 1.09, 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. MTCAX has generated a positive alpha over the past five years of 0.96, demonstrating that managers in this portfolio are skilled in picking securities that generate better-than-benchmark returns.
Expenses
For investors, taking a closer look at cost-related metrics is key, since costs are increasingly important for mutual fund investing. Competition is heating up in this space, and a lower cost product will likely outperform its otherwise identical counterpart, all things being equal. In terms of fees, MTCAX is a load fund. It has an expense ratio of 1.12% compared to the category average of 0.99%. Looking at the fund from a cost perspective, MTCAX is actually more expensive than its peers.
Investors should also note that the minimum initial investment for the product is $1,000 and that each subsequent investment needs to be at $50
Fees charged by investment advisors have not been taken into considiration. Returns would be less if those were included.
Bottom Line
Overall, MFS Technology Fund A ( MTCAX ) has a low Zacks Mutual Fund rank, and in conjunction with its comparatively similar performance, worse downside risk, and higher fees, this fund looks like a somewhat weak choice for investors right now.
Don't stop here for your research on Sector - Tech 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 MTCAX to its peers as well for additional information. If you want to check out our stock reports as well, make sure to go to Zacks.com to see all of the great tools we have to offer, including our time-tested Zacks Rank.
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Is MFS Technology Fund A (MTCAX) a Strong Mutual Fund Pick Right Now?
Having trouble finding a Sector - Tech fund? Well, MFS Technology Fund A (MTCAX - Free Report) would not be a good potential starting point right now. MTCAX possesses a Zacks Mutual Fund Rank of 4 (Sell), which is based on various forecasting factors like size, cost, and past performance.
Objective
MTCAX is part of the Sector - Tech category, which boasts an array of different possible selections. With a much more diversified approach, Sector - Tech mutual funds give investors a way to own a stake in a notoriously risky sector. Tech companies are in various industries like semiconductors, software, internet, and networking, among others.
History of Fund/Manager
MFS is based in Boston, MA, and is the manager of MTCAX. MFS Technology Fund A debuted in January of 1997. Since then, MTCAX has accumulated assets of about $1 billion, according to the most recently available information. Reiner Dobbelmann is the fund's current manager and has held that role since May of 2022.
Performance
Obviously, what investors are looking for in these funds is strong performance relative to their peers. This fund carries a 5-year annualized total return of 17.47%, and it sits 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 9.78%, which places it in the top 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. MTCAX's standard deviation over the past three years is 22.68% compared to the category average of 15.56%. The fund's standard deviation over the past 5 years is 21.91% compared to the category average of 16.37%. 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 1.09, 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. MTCAX has generated a positive alpha over the past five years of 0.96, demonstrating that managers in this portfolio are skilled in picking securities that generate better-than-benchmark returns.
Expenses
For investors, taking a closer look at cost-related metrics is key, since costs are increasingly important for mutual fund investing. Competition is heating up in this space, and a lower cost product will likely outperform its otherwise identical counterpart, all things being equal. In terms of fees, MTCAX is a load fund. It has an expense ratio of 1.12% compared to the category average of 0.99%. Looking at the fund from a cost perspective, MTCAX is actually more expensive than its peers.
Investors should also note that the minimum initial investment for the product is $1,000 and that each subsequent investment needs to be at $50
Fees charged by investment advisors have not been taken into considiration. Returns would be less if those were included.
Bottom Line
Overall, MFS Technology Fund A ( MTCAX ) has a low Zacks Mutual Fund rank, and in conjunction with its comparatively similar performance, worse downside risk, and higher fees, this fund looks like a somewhat weak choice for investors right now.
Don't stop here for your research on Sector - Tech 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 MTCAX to its peers as well for additional information. If you want to check out our stock reports as well, make sure to go to Zacks.com to see all of the great tools we have to offer, including our time-tested Zacks Rank.