Back to top

Image: Bigstock

Is ProFunds UltraChina Investor (UGPIX) a Strong Mutual Fund Pick Right Now?

Read MoreHide Full Article

If investors are looking at the China - Equity fund category, ProFunds UltraChina Investor (UGPIX - Free Report) could be a potential option. UGPIX holds a Zacks Mutual Fund Rank of 2 (Buy), which is based on various forecasting factors like size, cost, and past performance.

Objective

We classify UGPIX in the China - Equity category, an area that is rife with potential choices. China - Equity mutual funds almost exclusively target stocks throughout China, Taiwan, and Hong Kong. China has changed drastically over the years, and even though we still associate the country's economy with export-focused manufacturing, it now focuses more than ever on its middle class. If you like the sounds of this investment method, then UGPIX could be worth a closer look for your portfolio.

History of Fund/Manager

ProFunds is responsible for UGPIX, and the company is based out of Columbus, OH. The ProFunds UltraChina Investor made its debut in February of 2008 and UGPIX has managed to accumulate roughly $24.38 million in assets, as of the most recently available information. The fund is currently managed by Alexander Ilyasov who has been in charge of the fund since August of 2020.

Performance

Investors naturally seek funds with strong performance. This fund carries a 5-year annualized total return of -31.13%, and it sits in the bottom third among its category peers. Investors who prefer analyzing shorter time frames should look at its 3-year annualized total return of -7.87%, 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. The standard deviation of UGPIX over the past three years is 90.41% compared to the category average of 25.26%. The standard deviation of the fund over the past 5 years is 78.5% compared to the category average of 24.62%. 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 0.76, so it is likely going to be less 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. The fund has produced a negative alpha over the past 5 years of -20.05, which shows that managers in this portfolio find it difficult to pick 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, UGPIX is a no load fund. It has an expense ratio of 1.78% compared to the category average of 1.41%. From a cost perspective, UGPIX is actually more expensive than its peers.

While the minimum initial investment for the product is $15,000, investors should also note that there is no minimum for each subsequent investment.

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

Bottom Line

Overall, even with its comparatively weak performance, worse downside risk, and higher fees, ProFunds UltraChina Investor ( UGPIX ) has a high Zacks Mutual Fund rank, and therefore looks a good potential choice for investors right now.

For additional information on the China - 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 UGPIX too for additional information. If you are more of a stock investor, make sure to also check out our Zacks Rank, and our full suite of tools we have available for novice and professional investors alike.


See More Zacks Research for These Tickers


Normally $25 each - click below to receive one report FREE:


ProFunds UltraChina Inv (UGPIX) - free report >>

Published in