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Is Franklin Corefolio Allocation A (FTCOX) a Strong Mutual Fund Pick Right Now?
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On the lookout for a Allocation Balanced fund? Starting with Franklin Corefolio Allocation A (FTCOX - Free Report) should not be a possibility at this time. FTCOX bears a Zacks Mutual Fund Rank of 4 (Sell), which is based on various forecasting factors like size, cost, and past performance.
Objective
FTCOX 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
Franklin is based in San Mateo, CA, and is the manager of FTCOX. Since Franklin Corefolio Allocation A made its debut in August of 2003, FTCOX has garnered more than $908.76 million in assets. A team of investment professionals is the fund's current manager.
Performance
Investors naturally seek funds with strong performance. This fund has delivered a 5-year annualized total return of 7.4%, and it sits in the middle third among its category peers. But if you are looking for a shorter time frame, it is also worth looking at its 3-year annualized total return of 14.9%, which places it in the middle 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. The standard deviation of FTCOX over the past three years is 12.64% compared to the category average of 11.23%. The standard deviation of the fund over the past 5 years is 15.26% compared to the category average of 13.13%. This makes the fund more volatile than its peers over the past half-decade.
Risk Factors
With a 5-year beta of 0.97, the fund is likely to be as volatile as the market average. 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. FTCOX's 5-year performance has produced a negative alpha of -5.1, which means 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, FTCOX is a load fund. It has an expense ratio of 0.38% compared to the category average of 0.94%. Looking at the fund from a cost perspective, FTCOX is actually cheaper than its peers.
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 Corefolio Allocation A ( FTCOX ) has a low Zacks Mutual Fund rank, and in conjunction with its comparatively similar performance, average downside risk, and lower fees, this fund looks like a somewhat weak choice for investors right now.
For additional information on the Allocation Balanced area of the mutual fund world, make sure to check out www.zacks.com/funds/mutual-funds. There, you can see more about the ranking process, and dive even deeper into FTCOX too 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 Franklin Corefolio Allocation A (FTCOX) a Strong Mutual Fund Pick Right Now?
On the lookout for a Allocation Balanced fund? Starting with Franklin Corefolio Allocation A (FTCOX - Free Report) should not be a possibility at this time. FTCOX bears a Zacks Mutual Fund Rank of 4 (Sell), which is based on various forecasting factors like size, cost, and past performance.
Objective
FTCOX 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
Franklin is based in San Mateo, CA, and is the manager of FTCOX. Since Franklin Corefolio Allocation A made its debut in August of 2003, FTCOX has garnered more than $908.76 million in assets. A team of investment professionals is the fund's current manager.
Performance
Investors naturally seek funds with strong performance. This fund has delivered a 5-year annualized total return of 7.4%, and it sits in the middle third among its category peers. But if you are looking for a shorter time frame, it is also worth looking at its 3-year annualized total return of 14.9%, which places it in the middle 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. The standard deviation of FTCOX over the past three years is 12.64% compared to the category average of 11.23%. The standard deviation of the fund over the past 5 years is 15.26% compared to the category average of 13.13%. This makes the fund more volatile than its peers over the past half-decade.
Risk Factors
With a 5-year beta of 0.97, the fund is likely to be as volatile as the market average. 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. FTCOX's 5-year performance has produced a negative alpha of -5.1, which means 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, FTCOX is a load fund. It has an expense ratio of 0.38% compared to the category average of 0.94%. Looking at the fund from a cost perspective, FTCOX is actually cheaper than its peers.
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 Corefolio Allocation A ( FTCOX ) has a low Zacks Mutual Fund rank, and in conjunction with its comparatively similar performance, average downside risk, and lower fees, this fund looks like a somewhat weak choice for investors right now.
For additional information on the Allocation Balanced area of the mutual fund world, make sure to check out www.zacks.com/funds/mutual-funds. There, you can see more about the ranking process, and dive even deeper into FTCOX too 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.