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Is Schwab International Core Equity (SICNX) a Strong Mutual Fund Pick Right Now?

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If you have been looking for Non US - Equity funds, a place to start could be Schwab International Core Equity (SICNX - Free Report) . SICNX bears a Zacks Mutual Fund Rank of 1 (Strong Buy), which is based on various forecasting factors like size, cost, and past performance.

Objective

Zacks categorizes SICNX as Non US - Equity, a segment stacked high with options. Non US - Equity mutual funds like to invest in companies outside of the United States, an important characteristic since global mutual funds are known to keep a good portion of their portfolio stateside. These kinds of funds can often extend across all cap levels, and will typically allocate their investments between emerging and developed markets.

History of Fund/Manager

Schwab Funds is based in San Francisco, CA, and is the manager of SICNX. Schwab International Core Equity debuted in May of 2008. Since then, SICNX has accumulated assets of about $602.33 million, according to the most recently available information. Wei Li is the fund's current manager and has held that role since June of 2013.

Performance

Obviously, what investors are looking for in these funds is strong performance relative to their peers. SICNX has a 5-year annualized total return of 5.17% and is in the top 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 3.47%, 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. SICNX's standard deviation over the past three years is 16.87% compared to the category average of 17.46%. Over the past 5 years, the standard deviation of the fund is 17.69% compared to the category average of 18.3%. This makes the fund less 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. SICNX has a 5-year beta of 0.86, which means it is likely to be less volatile than the market average. 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. The fund has produced a negative alpha over the past 5 years of -6.66, which shows that managers in this portfolio find it difficult to pick securities that generate better-than-benchmark returns.

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, SICNX is a no load fund. It has an expense ratio of 0.86% compared to the category average of 0.81%. From a cost perspective, SICNX is actually more expensive than its peers.

This fund requires a minimum initial investment of $0, while there is no minimum for each subsequent investment.

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

Bottom Line

Overall, Schwab International Core Equity ( SICNX ) has a high Zacks Mutual Fund rank, and in conjunction with its comparatively strong performance, average downside risk, and higher fees, Schwab International Core Equity ( SICNX ) looks like a good potential choice for investors right now.

For additional information on the Non US - Equity 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 SICNX too 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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