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Is Federated MDT Small Cap Growth Fund A (QASGX) a Strong Mutual Fund Pick Right Now?
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Any investors hoping to find a Small Cap Growth fund could think about starting with Federated MDT Small Cap Growth Fund A (QASGX - Free Report) . QASGX holds a Zacks Mutual Fund Rank of 1 (Strong Buy), which is based on various forecasting factors like size, cost, and past performance.
Objective
QASGX is part of the Small Cap Growth category, and this segment boasts an array of many other possible options. Small Cap Growth mutual funds usually focus their portfolios on stocks with large growth opportunities and a market cap of under $2 billion. These portfolios tend to feature small companies in up-and-coming industries and markets.
History of Fund/Manager
Federated is based in Pittsburgh, PA, and is the manager of QASGX. Federated MDT Small Cap Growth Fund A debuted in September of 2005. Since then, QASGX has accumulated assets of about $87.89 million, according to the most recently available information. 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 in particular has delivered a 5-year annualized total return of 5.1%, and it sits in the top third among its category peers. If you're interested in shorter time frames, do not dismiss looking at the fund's 3-year annualized total return of 13.52%, 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. QASGX's standard deviation over the past three years is 19.21% compared to the category average of 12.49%. Over the past 5 years, the standard deviation of the fund is 20.03% compared to the category average of 14.37%. This makes the fund more volatile than its peers over the past half-decade.
Risk Factors
The fund has a 5-year beta of 1.11, 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 -8.44. This means that managers in this portfolio find it difficult to pick securities that generate better-than-benchmark returns.
Holdings
Examining 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 principally on equities that are traded in the United States.
Currently, this mutual fund is holding 82.04% in stocks, with an average market capitalization of $6.99 billion. The fund has the heaviest exposure to the following market sectors:
Technology
Health
Finance
Industrial Cyclical
With turnover at about 91%, this fund makes fewer trades than the average comparable fund.
Expenses
Costs are increasingly important for mutual fund investing, and particularly as competition heats up in this market. And all things being equal, a lower cost product will outperform its otherwise identical counterpart, so taking a closer look at these metrics is key for investors. In terms of fees, QASGX is a load fund. It has an expense ratio of 1.13% compared to the category average of 0.99%. So, QASGX is actually more expensive than its peers from a cost perspective.
Investors should also note that the minimum initial investment for the product is $1,500 and that each subsequent investment needs to be at $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 strong performance, worse downside risk, and higher fees, Federated MDT Small Cap Growth Fund A ( QASGX ) has a high Zacks Mutual Fund rank, and therefore looks a good potential choice for investors right now.
Your research on the Small Cap Growth segment doesn't have to stop here. You can check out all the great mutual fund tools we have to offer by going to www.zacks.com/funds/mutual-funds to see the additional features we offer as well 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 Federated MDT Small Cap Growth Fund A (QASGX) a Strong Mutual Fund Pick Right Now?
Any investors hoping to find a Small Cap Growth fund could think about starting with Federated MDT Small Cap Growth Fund A (QASGX - Free Report) . QASGX holds a Zacks Mutual Fund Rank of 1 (Strong Buy), which is based on various forecasting factors like size, cost, and past performance.
Objective
QASGX is part of the Small Cap Growth category, and this segment boasts an array of many other possible options. Small Cap Growth mutual funds usually focus their portfolios on stocks with large growth opportunities and a market cap of under $2 billion. These portfolios tend to feature small companies in up-and-coming industries and markets.
History of Fund/Manager
Federated is based in Pittsburgh, PA, and is the manager of QASGX. Federated MDT Small Cap Growth Fund A debuted in September of 2005. Since then, QASGX has accumulated assets of about $87.89 million, according to the most recently available information. 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 in particular has delivered a 5-year annualized total return of 5.1%, and it sits in the top third among its category peers. If you're interested in shorter time frames, do not dismiss looking at the fund's 3-year annualized total return of 13.52%, 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. QASGX's standard deviation over the past three years is 19.21% compared to the category average of 12.49%. Over the past 5 years, the standard deviation of the fund is 20.03% compared to the category average of 14.37%. This makes the fund more volatile than its peers over the past half-decade.
Risk Factors
The fund has a 5-year beta of 1.11, 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 -8.44. This means that managers in this portfolio find it difficult to pick securities that generate better-than-benchmark returns.
Holdings
Examining 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 principally on equities that are traded in the United States.
Currently, this mutual fund is holding 82.04% in stocks, with an average market capitalization of $6.99 billion. The fund has the heaviest exposure to the following market sectors:
With turnover at about 91%, this fund makes fewer trades than the average comparable fund.
Expenses
Costs are increasingly important for mutual fund investing, and particularly as competition heats up in this market. And all things being equal, a lower cost product will outperform its otherwise identical counterpart, so taking a closer look at these metrics is key for investors. In terms of fees, QASGX is a load fund. It has an expense ratio of 1.13% compared to the category average of 0.99%. So, QASGX is actually more expensive than its peers from a cost perspective.
Investors should also note that the minimum initial investment for the product is $1,500 and that each subsequent investment needs to be at $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 strong performance, worse downside risk, and higher fees, Federated MDT Small Cap Growth Fund A ( QASGX ) has a high Zacks Mutual Fund rank, and therefore looks a good potential choice for investors right now.
Your research on the Small Cap Growth segment doesn't have to stop here. You can check out all the great mutual fund tools we have to offer by going to www.zacks.com/funds/mutual-funds to see the additional features we offer as well 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.