There are plenty of choices in the Non US - Equity category, but where should you start your research? Well, one fund that might be worth investigating is American Century Emerging Market A (AEMMX - Free Report) . AEMMX possesses a Zacks Mutual Fund Rank of 1 (Strong Buy), which is based on nine forecasting factors like size, cost, and past performance.
We classify AEMMX in the Non US - Equity category, which is an area rife with potential choices. Investing in companies outside the United States is how Non US - Equity funds set themselves apart, since global funds tend to keep a good portion of their portfolio stateside. Many of these funds like to allocate across emerging and developed markets, and will often focus on all cap levels.
History of Fund/Manager
American Century is based in Kansas City, MO, and is the manager of AEMMX. American Century Emerging Market A made its debut in May of 1999, and since then, AEMMX has accumulated about $76.03 million in assets, per the most up-to-date date available. The fund is currently managed by Patricia Ribeiro who has been in charge of the fund since May of 2006.
Investors naturally seek funds with strong performance. This fund in particular has delivered a 5-year annualized total return of 8.19%, 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 14.66%, 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. Compared to the category average of 9.26%, the standard deviation of AEMMX over the past three years is 14.57%. Looking at the past 5 years, the fund's standard deviation is 14.21% compared to the category average of 11.95%. This makes the fund more volatile than its peers over the past half-decade.
Investors should always remember the downsides to a potential investment, and this segment carries some risks one should be aware of. In AEMMX's case, the fund lost 68.22% in the most recent bear market and underperformed its peer group by 9.84%. This might suggest that the fund is a worse choice than its peers during a bear market.
Investors should not forget about beta, an important way to measure a mutual fund's risk compared to the market as a whole. AEMMX has a 5-year beta of 0.92, which means it is likely to be less volatile than the market average. Alpha is an additional metric to take into consideration, since it represents a portfolio's performance on a risk-adjusted basis relative to a benchmark, which in this case, is the S&P 500. With a negative alpha of -5.05, managers in this portfolio find it difficult to pick securities that generate better-than-benchmark returns.
For investors, taking a closer look at cost-related metrics is key, since costs are increasingly important for mutual fund investing. Competition is heating up in this space, and a lower cost product will likely outperform its otherwise identical counterpart, all things being equal. In terms of fees, AEMMX is a load fund. It has an expense ratio of 1.52% compared to the category average of 1.29%. Looking at the fund from a cost perspective, AEMMX is actually more expensive than its peers.
Investors should also note that the minimum initial investment for the product is $2,500 and that each subsequent investment needs to be at $50.
Overall, American Century Emerging Market A has a high Zacks Mutual Fund rank, and in conjunction with its comparatively similar performance, average downside risk, and higher fees, American Century Emerging Market A looks like a good potential choice for investors right now.
Don't stop here for your research on Non US - Equity funds. We also have plenty more on our site in order to help you find the best possible fund for your portfolio. Make sure to check out www.zacks.com/funds/mutual-funds for more information about the world of funds, and feel free to compare AEMMX to its peers 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.