If you're looking for a Large Cap Growth fund category, then a potential option is Schwab Large-Cap Growth (SWLSX - Free Report) . SWLSX bears a Zacks Mutual Fund Rank of 3 (Hold), which is based on nine forecasting factors like size, cost, and past performance.
SWLSX is part of the Large Cap Growth section, and this segment boasts an array of other possible options. Large Cap Growth mutual funds purchase stakes in numerous large U.S. companies that are expected to develop and grow at a faster rate than other large-cap stocks. Companies are usually considered to be large-cap if their market capitalization is over $10 billion.
History of Fund/Manager
Schwab Funds is based in San Francisco, CA, and is the manager of SWLSX. Schwab Large-Cap Growth debuted in October of 2005. Since then, SWLSX has accumulated assets of about $257 million, according to the most recently available information. The fund is currently managed by a team of investment professionals.
Obviously, what investors are looking for in these funds is strong performance relative to their peers. This fund in particular has delivered a 5-year annualized total return of 15.46%, and it sits in the middle 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 10.94%, which places it in the middle 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 11.73%, the standard deviation of SWLSX over the past three years is 10.96%. Looking at the past 5 years, the fund's standard deviation is 10.65% compared to the category average of 11.3%. This makes the fund less 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. SWLSX lost 46.12% in the most recent bear market and outperformed its peer group by 2.86%. This could mean that the fund is a better choice than comparable funds during a bear market.
Investors should note that the fund has a 5-year beta of 1.04, 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. SWLSX's 5-year performance has produced a positive alpha of 0.24, which means managers in this portfolio are skilled in picking securities that generate better-than-benchmark returns.
Examining 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 mostly on equities that are traded in the United States.
As of the last filing date, the mutual fund has 96.82% of its assets in stocks, and these companies have an average market capitalization of $213.33 billion. The fund has the heaviest exposure to the following market sectors:
Turnover is 81%, which means this fund makes more trades in a given year than the average of comparable funds.
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, SWLSX is a no load fund. It has an expense ratio of 0.99% compared to the category average of 1.12%. Looking at the fund from a cost perspective, SWLSX is actually cheaper than its peers.
While the minimum initial investment for the product is $100, investors should also note that there is no minimum for each subsequent investment.
Overall, Schwab Large-Cap Growth has a neutral Zacks Mutual Fund rank, and in conjunction with its comparatively similar performance, average downside risk, and lower fees, this fund looks like a somewhat average choice for investors right now.
Don't stop here for your research on Large Cap Growth 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 SWLSX to its peers 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.