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Is American Funds Balanced R3 (RLBCX) a Strong Mutual Fund Pick Right Now?
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Having trouble finding a Allocation Balanced fund? American Funds Balanced R3 (RLBCX - Free Report) is a potential starting point. RLBCX possesses a Zacks Mutual Fund Rank of 1 (Strong Buy), which is based on various forecasting factors like size, cost, and past performance.
Objective
RLBCX is classified in the Allocation Balanced segment by Zacks, which is an area full of possibilities. Here, investors are able to get a good head start with diversified mutual funds, and play around with core holding options for a portfolio of funds. Allocation Balanced funds look to invest across a balance of asset types, like stocks, bonds, and cash, though including precious metals or commodities is not unusual; these funds are mostly categorized by their respective asset allocation.
History of Fund/Manager
American Funds is responsible for RLBCX, and the company is based out of Los Angeles, CA. American Funds Balanced R3 debuted in July of 1975. Since then, RLBCX has accumulated assets of about $2.53 billion, according to the most recently available information. The fund's current manager is a team of investment professionals.
Performance
Investors naturally seek funds with strong performance. RLBCX has a 5-year annualized total return of 9.43%, and it sits in the top third among its category peers. Investors who prefer analyzing shorter time frames should look at its 3-year annualized total return of 14.13%, 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. Compared to the category average of 10.45%, the standard deviation of RLBCX over the past three years is 8.24%. Looking at the past 5 years, the fund's standard deviation is 10.21% compared to the category average of 12.42%. This makes the fund less volatile than its peers over the past half-decade.
Risk Factors
Investors should note that the fund has a 5-year beta of 0.65, which means 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 negative alpha of -1.47. 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, RLBCX is a no load fund. It has an expense ratio of 0.89% compared to the category average of 0.93%. So, RLBCX is actually cheaper than its peers from a cost perspective.
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
Overall, American Funds Balanced R3 ( RLBCX ) has a high Zacks Mutual Fund rank, and in conjunction with its comparatively strong performance, average downside risk, and lower fees, American Funds Balanced R3 ( RLBCX ) looks like a good potential choice for investors right now.
This could just be the start of your research on RLBCX in the Allocation Balanced category. Consider going to www.zacks.com/funds/mutual-funds for additional information about this fund, and all the others that we rank as well 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 American Funds Balanced R3 (RLBCX) a Strong Mutual Fund Pick Right Now?
Having trouble finding a Allocation Balanced fund? American Funds Balanced R3 (RLBCX - Free Report) is a potential starting point. RLBCX possesses a Zacks Mutual Fund Rank of 1 (Strong Buy), which is based on various forecasting factors like size, cost, and past performance.
Objective
RLBCX is classified in the Allocation Balanced segment by Zacks, which is an area full of possibilities. Here, investors are able to get a good head start with diversified mutual funds, and play around with core holding options for a portfolio of funds. Allocation Balanced funds look to invest across a balance of asset types, like stocks, bonds, and cash, though including precious metals or commodities is not unusual; these funds are mostly categorized by their respective asset allocation.
History of Fund/Manager
American Funds is responsible for RLBCX, and the company is based out of Los Angeles, CA. American Funds Balanced R3 debuted in July of 1975. Since then, RLBCX has accumulated assets of about $2.53 billion, according to the most recently available information. The fund's current manager is a team of investment professionals.
Performance
Investors naturally seek funds with strong performance. RLBCX has a 5-year annualized total return of 9.43%, and it sits in the top third among its category peers. Investors who prefer analyzing shorter time frames should look at its 3-year annualized total return of 14.13%, 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. Compared to the category average of 10.45%, the standard deviation of RLBCX over the past three years is 8.24%. Looking at the past 5 years, the fund's standard deviation is 10.21% compared to the category average of 12.42%. This makes the fund less volatile than its peers over the past half-decade.
Risk Factors
Investors should note that the fund has a 5-year beta of 0.65, which means 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 negative alpha of -1.47. 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, RLBCX is a no load fund. It has an expense ratio of 0.89% compared to the category average of 0.93%. So, RLBCX is actually cheaper than its peers from a cost perspective.
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
Overall, American Funds Balanced R3 ( RLBCX ) has a high Zacks Mutual Fund rank, and in conjunction with its comparatively strong performance, average downside risk, and lower fees, American Funds Balanced R3 ( RLBCX ) looks like a good potential choice for investors right now.
This could just be the start of your research on RLBCX in the Allocation Balanced category. Consider going to www.zacks.com/funds/mutual-funds for additional information about this fund, and all the others that we rank as well 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.