On the lookout for a Sector - Utilities fund? Starting with Franklin Utilities A1 (FKUTX Quick QuoteFKUTX - Free Report) is one possibility. FKUTX possesses a Zacks Mutual Fund Rank of 2 (Buy), which is based on various forecasting factors like size, cost, and past performance.

Objective

FKUTX is classified in the Sector - Utilities segment by Zacks, an area full of potential. Sector - Utilities mutual funds focus on companies that provide essential services such as electric power, gas distribution, and water supply to millions of people on a daily basis. Overall, the utility industry is known for its stability and reduced volatility.

History of Fund/Manager

FKUTX is a part of the Franklin family of funds, a company based out of San Mateo, CA. The Franklin Utilities A1 made its debut in September of 1948 and FKUTX has managed to accumulate roughly $3.57 billion in assets, as of the most recently available information. John Kohli is the fund's current manager and has held that role since December of 1998.

Performance

Of course, investors look for strong performance in funds. This fund in particular has delivered a 5-year annualized total return of 12.28%, 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 16.05%, 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. FKUTX's standard deviation over the past three years is 14.44% compared to the category average of 11.05%. Over the past 5 years, the standard deviation of the fund is 15.63% compared to the category average of 13.07%. This makes the fund more volatile than its peers over the past half-decade.

Risk Factors

With a 5-year beta of 0.63, the fund is likely to be less volatile than the market average. 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 3.71. This means that managers in this portfolio are skilled in picking securities that generate better-than-benchmark returns.

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, FKUTX is a load fund. It has an expense ratio of 0.70% compared to the category average of 0.94%. So, FKUTX is actually cheaper than its peers from a cost perspective.

While the minimum initial investment for the product is $1,000, investors should also note that there is no minimum for each subsequent investment.

Fees charged by investment advisors have not been taken into consideration. Returns would be less if those were included.

Bottom Line

Overall, Franklin Utilities A1 ( FKUTX ) has a high Zacks Mutual Fund rank, and in conjunction with its comparatively strong performance, average downside risk, and lower fees, Franklin Utilities A1 ( FKUTX ) 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 Sector - Utilities, make sure to go to www.zacks.com/funds/mutual-funds for additional information. Zacks provides a full suite of tools to help you analyze your portfolio - both funds and stocks - in the most efficient way possible.