Back to top

Image: Bigstock

Is ClearBridge Aggressive Growth A (SHRAX) a Strong Mutual Fund Pick Right Now?

Read MoreHide Full Article

If you have been looking for Large Cap Growth funds, a place to start could be ClearBridge Aggressive Growth A (SHRAX - Free Report) . SHRAX has a Zacks Mutual Fund Rank of 2 (Buy), which is based on various forecasting factors like size, cost, and past performance.

Objective

SHRAX is part of the Large Cap Growth section, and this segment boasts an array of other possible options. Large Cap Growth mutual funds purchase stakes in numerous large U.S. companies that are expected to develop and grow at a faster rate than other large-cap stocks. Companies are usually considered to be large-cap if their market capitalization is over $10 billion.

History of Fund/Manager

Franklin is based in San Mateo, CA, and is the manager of SHRAX. ClearBridge Aggressive Growth A made its debut in October of 1983, and since then, SHRAX has accumulated about $4.14 billion in assets, per the most up-to-date date available. The fund is currently managed by a team of investment professionals.

Performance

Obviously, what investors are looking for in these funds is strong performance relative to their peers. This fund has delivered a 5-year annualized total return of 8.82%, 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 18.26%, 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. The standard deviation of SHRAX over the past three years is 16.13% compared to the category average of 12.84%. Over the past 5 years, the standard deviation of the fund is 18.48% compared to the category average of 13.28%. This makes the fund more 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. SHRAX has a 5-year beta of 1.05, which means it is likely to be more 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. Over the past 5 years, the fund has a negative alpha of -6.8. This means 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, SHRAX is a load fund. It has an expense ratio of 1.13% compared to the category average of 0.94%. Looking at the fund from a cost perspective, SHRAX is actually more expensive than its peers.

Investors need to be aware that with this product, the minimum initial investment is $1,000; each subsequent investment needs to be at least $50.

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 similar performance, worse downside risk, and higher fees, ClearBridge Aggressive Growth A ( SHRAX ) has a high Zacks Mutual Fund rank, and therefore looks a good potential choice for investors right now.

Want even more information about SHRAX? Then go over to Zacks.com and check out our mutual fund comparison tool, and all of the other great features that we have to help you with your mutual fund analysis for additional information. Zacks provides a full suite of tools to help you analyze your portfolio - both funds and stocks - in the most efficient way possible.


See More Zacks Research for These Tickers


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


ClearBridge Growth A (SHRAX) - free report >>

Published in