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Is American Beacon London Company Income Equity Y (ABCYX) a Strong Mutual Fund Pick Right Now?
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If you have been looking for Large Cap Value funds, a place to start could be American Beacon London Company Income Equity Y (ABCYX - Free Report) . ABCYX holds a Zacks Mutual Fund Rank of 2 (Buy), which is based on various forecasting factors like size, cost, and past performance.
Objective
ABCYX is one of many Large Cap Value mutual funds to choose from. These funds invest in equities with a market capitalization of $10 billion or more, but whose share prices do not reflect their intrinsic value. This strategy can often produce low P/E ratios and high dividend yields; however, growth levels are oftentimes cut back. These funds' high growth opportunities are slowed even more since large-cap stocks are usually in more stable industries with low to moderate growth prospects. Thus, investors interested in a stable income stream find Large Cap Value funds very appealing.
History of Fund/Manager
American Beacon is responsible for ABCYX, and the company is based out of Irving, TX. American Beacon London Company Income Equity Y debuted in May of 2012. Since then, ABCYX has accumulated assets of about $665.42 million, according to the most recently available information. A team of investment professionals is the fund's current manager.
Performance
Investors naturally seek funds with strong performance. This fund carries a 5-year annualized total return of 8.16%, and is in the bottom 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 15.25%, which places it in the bottom 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. Over the past three years, ABCYX's standard deviation comes in at 11.18%, compared to the category average of 11.2%. The standard deviation of the fund over the past 5 years is 14.1% compared to the category average of 13.14%. This makes the fund more volatile than its peers over the past half-decade.
Risk Factors
With a 5-year beta of 0.79, the fund 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 -2.51, managers in this portfolio find it difficult to pick 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, ABCYX is a no load fund. It has an expense ratio of 0.82% compared to the category average of 0.93%. So, ABCYX is actually cheaper than its peers from a cost perspective.
Investors should also note that the minimum initial investment for the product is $100,000 and that each subsequent investment needs to be at $50.
Fees charged by investment advisors have not been taken into consideration. Returns would be less if those were included.
Bottom Line
Overall, even with its comparatively weak performance, average downside risk, and lower fees, American Beacon London Company Income Equity Y ( ABCYX ) has a high Zacks Mutual Fund rank, and therefore looks a great potential choice for investors right now.
This could just be the start of your research on ABCYX in the Large Cap Value 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. And don't forget, Zacks has all of your needs covered on the equity side too! Make sure to check out Zacks.com for more information on our screening capabilities, Rank, and all our articles as well.
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Is American Beacon London Company Income Equity Y (ABCYX) a Strong Mutual Fund Pick Right Now?
If you have been looking for Large Cap Value funds, a place to start could be American Beacon London Company Income Equity Y (ABCYX - Free Report) . ABCYX holds a Zacks Mutual Fund Rank of 2 (Buy), which is based on various forecasting factors like size, cost, and past performance.
Objective
ABCYX is one of many Large Cap Value mutual funds to choose from. These funds invest in equities with a market capitalization of $10 billion or more, but whose share prices do not reflect their intrinsic value. This strategy can often produce low P/E ratios and high dividend yields; however, growth levels are oftentimes cut back. These funds' high growth opportunities are slowed even more since large-cap stocks are usually in more stable industries with low to moderate growth prospects. Thus, investors interested in a stable income stream find Large Cap Value funds very appealing.
History of Fund/Manager
American Beacon is responsible for ABCYX, and the company is based out of Irving, TX. American Beacon London Company Income Equity Y debuted in May of 2012. Since then, ABCYX has accumulated assets of about $665.42 million, according to the most recently available information. A team of investment professionals is the fund's current manager.
Performance
Investors naturally seek funds with strong performance. This fund carries a 5-year annualized total return of 8.16%, and is in the bottom 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 15.25%, which places it in the bottom 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. Over the past three years, ABCYX's standard deviation comes in at 11.18%, compared to the category average of 11.2%. The standard deviation of the fund over the past 5 years is 14.1% compared to the category average of 13.14%. This makes the fund more volatile than its peers over the past half-decade.
Risk Factors
With a 5-year beta of 0.79, the fund 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 -2.51, managers in this portfolio find it difficult to pick 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, ABCYX is a no load fund. It has an expense ratio of 0.82% compared to the category average of 0.93%. So, ABCYX is actually cheaper than its peers from a cost perspective.
Investors should also note that the minimum initial investment for the product is $100,000 and that each subsequent investment needs to be at $50.
Fees charged by investment advisors have not been taken into consideration. Returns would be less if those were included.
Bottom Line
Overall, even with its comparatively weak performance, average downside risk, and lower fees, American Beacon London Company Income Equity Y ( ABCYX ) has a high Zacks Mutual Fund rank, and therefore looks a great potential choice for investors right now.
This could just be the start of your research on ABCYX in the Large Cap Value 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. And don't forget, Zacks has all of your needs covered on the equity side too! Make sure to check out Zacks.com for more information on our screening capabilities, Rank, and all our articles as well.