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Is Eagle Mid Cap Growth A (HAGAX) a Strong Mutual Fund Pick Right Now?

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If you're looking for a Mid Cap Growth fund category, then a potential option is Eagle Mid Cap Growth A (HAGAX - Free Report) . HAGAX carries a Zacks Mutual Fund Rank of 3 (Hold), which is based on nine forecasting factors like size, cost, and past performance.

Objective

HAGAX is part of the Mid Cap Growth section, a segment that boasts a wide array of possible selections. While Mid Cap Growth mutual funds choose companies with a stock market valuation between $2 billion and $10 billion, stocks in these funds are also expected to show broad considerable growth opportunities for investors compared to their peers. To be considered a growth stock, companies must consistently report impressive sales and/or earnings growth.

History of Fund/Manager

Eagle Funds is responsible for HAGAX, and the company is based out of St. Petersburg, FL. Eagle Mid Cap Growth A made its debut in August of 1998, and since then, HAGAX has accumulated about $498.03 million in assets, per the most up-to-date date available. A team of investment professionals is the fund's current manager.

Performance

Investors naturally seek funds with strong performance. This fund in particular has delivered a 5-year annualized total return of 16.48%, and it sits 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 15.25%, 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, HAGAX's standard deviation comes in at 12.61%, compared to the category average of 9.18%. Over the past 5 years, the standard deviation of the fund is 11.86% compared to the category average of 8.94%. This makes the fund more volatile than its peers over the past half-decade.

Risk Factors

Investors cannot discount the risks to this segment though, as it is always important to remember the downside for any potential investment. In the most recent bear market, HAGAX lost 46.9% and outperformed its peer group by 4.22%. These results could imply that the fund is a better choice than its peers during a sliding market environment.

Nevertheless, with a 5-year beta of 1.11, the fund is likely to be more 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 negative alpha of -0.87. This means that managers in this portfolio find it difficult to pick securities that generate better-than-benchmark returns.

Holdings

Exploring 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 largely on equities that are traded in the United States.

Currently, this mutual fund is holding 82.88% stock in stocks, with an average market capitalization of $19.88 billion. The fund has the heaviest exposure to the following market sectors:

  1. Technology
  2. Non-Durable
  3. Industrial Cyclical
  4. Health

With turnover at about 44%, this fund makes fewer trades than comparable funds.

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, HAGAX is a load fund. It has an expense ratio of 1.12% compared to the category average of 1.16%. From a cost perspective, HAGAX is actually cheaper than its peers.

Investors need to be aware that with this product, the minimum initial investment is $1,000; each subsequent investment needs to be at least $50.

Bottom Line

Overall, Eagle Mid Cap Growth A has a neutral Zacks Mutual Fund rank, and in conjunction with its comparatively strong performance, average downside risk, and lower fees, this fund looks like a somewhat average choice for investors right now.

This could just be the start of your research on HAGAX in the Mid Cap Growth category. Consider going to www.zacks.com/funds/mutual-funds for additional information about this fund, and all the others that we rank as well 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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