If investors are looking at the Large Cap Growth fund category, Harbor Capital Appreciation Institutional (HACAX - Free Report) could be a potential option. HACAX has a Zacks Mutual Fund Rank of 1 (Strong Buy), which is based on nine forecasting factors like size, cost, and past performance.
HACAX is classified in the Large Cap Growth segment by Zacks, an area full of possibilities. Companies are usually considered to be large-cap if their stock market valuation is more than $10 billion. Large Cap Growth mutual funds invest in many large U.S. firms that are projected to grow at a faster rate than their large-cap peers.
History of Fund/Manager
HACAX finds itself in the Harbor Funds family, based out of Chicago, IL. Since Harbor Capital Appreciation Institutional made its debut in December of 1987, HACAX has garnered more than $22.21 billion in assets. The fund is currently managed by Spiros Segalas who has been in charge of the fund since May of 1990.
Investors naturally seek funds with strong performance. This fund has delivered a 5-year annualized total return of 17.82%, and is 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 14.47%, which places it in the top third during this time-frame.
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, HACAX's standard deviation comes in at 12.59%, compared to the category average of 9.31%. The fund's standard deviation over the past 5 years is 11.87% compared to the category average of 10.92%. This makes the fund more volatile than its peers over the past half-decade.
Investors cannot discount the risks to this segment though, as it is always important to remember the downside for any potential investment. In HACAX's case, the fund lost 43.95% in the most recent bear market and outperformed its peer group by 4.94%. This makes the fund a possibly better choice than its peers during a sliding market environment.
Investors should note that the fund has a 5-year beta of 1.05, so it is likely going to be 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 positive alpha of 1.36. This means that managers in this portfolio are skilled in picking securities that generate better-than-benchmark returns.
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 principally on equities that are traded in the United States.
The mutual fund currently has 95.5% of its holdings in stocks, which have an average market capitalization of $236.52 billion. The fund has the heaviest exposure to the following market sectors:
- Retail Trade
Turnover is about 58%, so those in charge of the fund make fewer trades than the average comparable fund.
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, HACAX is a no load fund. It has an expense ratio of 0.65% compared to the category average of 1.13%. Looking at the fund from a cost perspective, HACAX is actually cheaper than its peers.
This fund requires a minimum initial investment of $50,000, while there is no minimum for each subsequent investment.
Overall, Harbor Capital Appreciation Institutional has a high Zacks Mutual Fund rank, and in conjunction with its comparatively strong performance, average downside risk, and lower fees, Harbor Capital Appreciation Institutional looks like a good potential choice for investors right now.
For additional information on this product, or to compare it to other mutual funds in the Large Cap Growth, make sure to go to www.zacks.com/funds/mutual-funds for additional information. And don't forget, Zacks has all of your needs covered on the equity side too! Make sure to check out Zacks.com for more information on our screening capabilities, Rank, and all our articles as well.