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Is American Funds Mutual Fund A (AMRMX) a Strong Mutual Fund Pick Right Now?
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If investors are looking at the Large Cap Value fund category, American Funds Mutual Fund A (AMRMX - Free Report) could be a potential option. AMRMX carries a Zacks Mutual Fund Rank of 2 (Buy), which is based on various forecasting factors like size, cost, and past performance.
Objective
AMRMX is one of many Large Cap Value mutual funds to choose from. These funds invest in equities with a market capitalization of $10 billion or more, but whose share prices do not reflect their intrinsic value. This strategy can often produce low P/E ratios and high dividend yields; however, growth levels are oftentimes cut back. These funds' high growth opportunities are slowed even more since large-cap stocks are usually in more stable industries with low to moderate growth prospects. Thus, investors interested in a stable income stream find Large Cap Value funds very appealing.
History of Fund/Manager
American Funds is based in Los Angeles, CA, and is the manager of AMRMX. The American Funds Mutual Fund A made its debut in February of 1950 and AMRMX has managed to accumulate roughly $43.69 billion in assets, as of the most recently available information. The fund's current manager is a team of investment professionals.
Performance
Obviously, what investors are looking for in these funds is strong performance relative to their peers. AMRMX has a 5-year annualized total return of 11.71%, and is in the middle third among its category peers. Investors who prefer analyzing shorter time frames should look at its 3-year annualized total return of 13.38%, 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. Over the past three years, AMRMX's standard deviation comes in at 9.91%, compared to the category average of 11.22%. The fund's standard deviation over the past 5 years is 11.93% compared to the category average of 12.7%. This makes the fund less volatile than its peers over the past half-decade.
Risk Factors
The fund has a 5-year beta of 0.71, so investors should note that it is hypothetically 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. Over the past 5 years, the fund has a positive alpha of 0.46. This means that managers in this portfolio are skilled in picking 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, AMRMX is a load fund and it has an expense ratio of 0.57%.
While the minimum initial investment for the product is $250, investors should also note that 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
This puts this fund from American Funds in the top 40% of all mutual funds we have a rank on right now. As a result, this is likely an excellent choice for investors seeking an option in the Large Cap Value category.
For additional information on the Large Cap Value 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 AMRMX too for additional information. For analysis of the rest of your portfolio, make sure to visit Zacks.com for our full suite of tools which will help you investigate all of your stocks and funds in one place.
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Is American Funds Mutual Fund A (AMRMX) a Strong Mutual Fund Pick Right Now?
If investors are looking at the Large Cap Value fund category, American Funds Mutual Fund A (AMRMX - Free Report) could be a potential option. AMRMX carries a Zacks Mutual Fund Rank of 2 (Buy), which is based on various forecasting factors like size, cost, and past performance.
Objective
AMRMX is one of many Large Cap Value mutual funds to choose from. These funds invest in equities with a market capitalization of $10 billion or more, but whose share prices do not reflect their intrinsic value. This strategy can often produce low P/E ratios and high dividend yields; however, growth levels are oftentimes cut back. These funds' high growth opportunities are slowed even more since large-cap stocks are usually in more stable industries with low to moderate growth prospects. Thus, investors interested in a stable income stream find Large Cap Value funds very appealing.
History of Fund/Manager
American Funds is based in Los Angeles, CA, and is the manager of AMRMX. The American Funds Mutual Fund A made its debut in February of 1950 and AMRMX has managed to accumulate roughly $43.69 billion in assets, as of the most recently available information. The fund's current manager is a team of investment professionals.
Performance
Obviously, what investors are looking for in these funds is strong performance relative to their peers. AMRMX has a 5-year annualized total return of 11.71%, and is in the middle third among its category peers. Investors who prefer analyzing shorter time frames should look at its 3-year annualized total return of 13.38%, 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. Over the past three years, AMRMX's standard deviation comes in at 9.91%, compared to the category average of 11.22%. The fund's standard deviation over the past 5 years is 11.93% compared to the category average of 12.7%. This makes the fund less volatile than its peers over the past half-decade.
Risk Factors
The fund has a 5-year beta of 0.71, so investors should note that it is hypothetically 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. Over the past 5 years, the fund has a positive alpha of 0.46. This means that managers in this portfolio are skilled in picking 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, AMRMX is a load fund and it has an expense ratio of 0.57%.
While the minimum initial investment for the product is $250, investors should also note that 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
This puts this fund from American Funds in the top 40% of all mutual funds we have a rank on right now. As a result, this is likely an excellent choice for investors seeking an option in the Large Cap Value category.
For additional information on the Large Cap Value 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 AMRMX too for additional information. For analysis of the rest of your portfolio, make sure to visit Zacks.com for our full suite of tools which will help you investigate all of your stocks and funds in one place.