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Is Wasatch Micro Cap Fund (WMICX) a Strong Mutual Fund Pick Right Now?
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If you've been stuck searching for Small Cap Growth funds, consider Wasatch Micro Cap Fund (WMICX - Free Report) as a possibility. WMICX carries a Zacks Mutual Fund Rank of 2 (Buy), which is based on various forecasting factors like size, cost, and past performance.
Objective
WMICX is one of many different Small Cap Growth funds to choose from. Small Cap Growth mutual funds build portfolios around stocks with market caps under $2 billion and large growth opportunities. Additionally, these portfolios typically highlight smaller companies in promising markets and industries.
History of Fund/Manager
Wasatch is based in Salt Lake City, UT, and is the manager of WMICX. Wasatch Micro Cap Fund made its debut in June of 1995, and since then, WMICX has accumulated about $525.61 million in assets, per the most up-to-date date available. Kenneth Korngiebel is the fund's current manager and has held that role since July of 2017.
Performance
Investors naturally seek funds with strong performance. This fund carries a 5-year annualized total return of 4.13%, and is 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 11.56%, 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. WMICX's standard deviation over the past three years is 22.57% compared to the category average of 16.03%. Looking at the past 5 years, the fund's standard deviation is 24.1% compared to the category average of 17.36%. This makes the fund more volatile than its peers over the past half-decade.
Risk Factors
The fund has a 5-year beta of 1.21, so investors should note that it is hypothetically more volatile than the market at large. Another factor to consider is alpha, as it reflects a portfolio's performance on a risk-adjusted basis relative to a benchmark-in this case, the S&P 500. Over the past 5 years, the fund has a negative alpha of -12.76. This means that managers in this portfolio find it difficult to pick securities that generate better-than-benchmark returns.
Holdings
Investigating 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.
Currently, this mutual fund is holding 77.12% in stocks, with an average market capitalization of $1.54 billion. The fund has the heaviest exposure to the following market sectors:
Technology
Health
Non-Durable
Industrial Cyclical
Turnover is 86%, which means this fund makes fewer trades than the average comparable fund.
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, WMICX is a no load fund. It has an expense ratio of 1.64% compared to the category average of 1.06%. From a cost perspective, WMICX is actually more expensive than its peers.
While the minimum initial investment for the product is $2,000, investors should also note that each subsequent investment needs to be at least $100.
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, Wasatch Micro Cap Fund ( WMICX ) has a high Zacks Mutual Fund rank, and therefore looks a good potential choice for investors right now.
For additional information on the Small Cap Growth 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 WMICX 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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Is Wasatch Micro Cap Fund (WMICX) a Strong Mutual Fund Pick Right Now?
If you've been stuck searching for Small Cap Growth funds, consider Wasatch Micro Cap Fund (WMICX - Free Report) as a possibility. WMICX carries a Zacks Mutual Fund Rank of 2 (Buy), which is based on various forecasting factors like size, cost, and past performance.
Objective
WMICX is one of many different Small Cap Growth funds to choose from. Small Cap Growth mutual funds build portfolios around stocks with market caps under $2 billion and large growth opportunities. Additionally, these portfolios typically highlight smaller companies in promising markets and industries.
History of Fund/Manager
Wasatch is based in Salt Lake City, UT, and is the manager of WMICX. Wasatch Micro Cap Fund made its debut in June of 1995, and since then, WMICX has accumulated about $525.61 million in assets, per the most up-to-date date available. Kenneth Korngiebel is the fund's current manager and has held that role since July of 2017.
Performance
Investors naturally seek funds with strong performance. This fund carries a 5-year annualized total return of 4.13%, and is 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 11.56%, 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. WMICX's standard deviation over the past three years is 22.57% compared to the category average of 16.03%. Looking at the past 5 years, the fund's standard deviation is 24.1% compared to the category average of 17.36%. This makes the fund more volatile than its peers over the past half-decade.
Risk Factors
The fund has a 5-year beta of 1.21, so investors should note that it is hypothetically more volatile than the market at large. Another factor to consider is alpha, as it reflects a portfolio's performance on a risk-adjusted basis relative to a benchmark-in this case, the S&P 500. Over the past 5 years, the fund has a negative alpha of -12.76. This means that managers in this portfolio find it difficult to pick securities that generate better-than-benchmark returns.
Holdings
Investigating 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.
Currently, this mutual fund is holding 77.12% in stocks, with an average market capitalization of $1.54 billion. The fund has the heaviest exposure to the following market sectors:
Turnover is 86%, which means this fund makes fewer trades than the average comparable fund.
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, WMICX is a no load fund. It has an expense ratio of 1.64% compared to the category average of 1.06%. From a cost perspective, WMICX is actually more expensive than its peers.
While the minimum initial investment for the product is $2,000, investors should also note that each subsequent investment needs to be at least $100.
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, Wasatch Micro Cap Fund ( WMICX ) has a high Zacks Mutual Fund rank, and therefore looks a good potential choice for investors right now.
For additional information on the Small Cap Growth 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 WMICX 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.