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Is Red Oak Technology Select (ROGSX) a Strong Mutual Fund Pick Right Now?

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There are plenty of choices in the Sector - Tech category, but where should you start your research? Well, one fund that you should consider investigating is Red Oak Technology Select (ROGSX - Free Report) . ROGSX possesses a Zacks Mutual Fund Rank of 3 (Hold), which is based on various forecasting factors like size, cost, and past performance.

Objective

The world of Sector - Tech funds is an area filled with options, and ROGSX is one of them. Sector - Tech mutual funds allow investors to own a stake in a notoriously volatile sector with a much more diversified approach. Tech companies can be in any number of industries such as semiconductors, software, internet, networking just to name a few.

History of Fund/Manager

ROGSX finds itself in the Oak Associates family, based out of Akron, OH. Since Red Oak Technology Select made its debut in December of 1998, ROGSX has garnered more than $722.30 million in assets. Robert D. Stimpson is the fund's current manager and has held that role since January of 2019.

Performance

Of course, investors look for strong performance in funds. ROGSX has a 5-year annualized total return of 14.14%, and is in the middle 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 24.37%, which places it in the middle 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. ROGSX's standard deviation over the past three years is 19.47% compared to the category average of 24.19%. The fund's standard deviation over the past 5 years is 19.84% compared to the category average of 24.25%. This makes the fund less volatile than its peers over the past half-decade.

Risk Factors

With a 5-year beta of 1.15, the fund is likely to be more volatile than the market average. Alpha is an additional metric to take into consideration, since it represents a portfolio's performance on a risk-adjusted basis relative to a benchmark, which in this case, is the S&P 500. With a negative alpha of -1.61, managers in this portfolio find it difficult to pick securities that generate better-than-benchmark returns.

Holdings

Exploring 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 mostly on equities that are traded in the United States.

Right now, 77.87% of this mutual fund's holdings are stocks, with an average market capitalization of $500.06 billion. The fund has the heaviest exposure to the following market sectors:

  • Technology

With turnover at about 2%, this fund is making fewer trades than its comparable peers.

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, ROGSX is a no load fund. It has an expense ratio of 0.90% compared to the category average of 1.26%. From a cost perspective, ROGSX is actually cheaper than its peers.

Investors need to be aware that with this product, the minimum initial investment is $2,000; each subsequent investment needs to be at least $25.

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

Bottom Line

Overall, Red Oak Technology Select ( ROGSX ) has a neutral Zacks Mutual Fund rank, and in conjunction with its comparatively similar performance, average downside risk, and lower fees, Red Oak Technology Select ( ROGSX ) looks like a somewhat average choice for investors right now.

For additional information on the Sector - Tech 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 ROGSX 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.


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