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Is Hodges Small Cap Fund Institutional Class (HDSIX) a Strong Mutual Fund Pick Right Now?
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If you have been looking for All Cap Growth funds, it would not be wise to start your search with Hodges Small Cap Fund Institutional Class (HDSIX - Free Report) . HDSIX has a Zacks Mutual Fund Rank of 4 (Sell), which is based on nine forecasting factors like size, cost, and past performance.
Objective
We note that HDSIX is an All Cap Growth option, and is loaded with different selections. All Cap Growth mutual funds look to invest in a wide variety of equities, no matter the size of the company and as long as the firm exhibits growth characteristics. In order to increase diversification, these portfolios have holdings across small, medium, and large-cap levels.
History of Fund/Manager
Hodges Capital is based in Dallas, TX, and is the manager of HDSIX. Since Hodges Small Cap Fund Institutional Class made its debut in December of 2008, HDSIX has garnered more than $99.77 million in assets. The fund is currently managed by a team of investment professionals.
Performance
Of course, investors look for strong performance in funds. This fund in particular has delivered a 5-year annualized total return of 0.85%, and it sits 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 2.31%, which places it in the bottom 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, HDSIX's standard deviation comes in at 17.78%, compared to the category average of 11.5%. The fund's standard deviation over the past 5 years is 16.33% compared to the category average of 11.46%. This makes the fund more volatile than its peers over the past half-decade.
Risk Factors
One cannot ignore the volatility of this segment, however, as it is always important for investors to remember the downside to any potential investment.
Even still, the fund has a 5-year beta of 1.23, so investors should note that it is hypothetically more volatile than the market at large. 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. HDSIX has generated a negative alpha over the past five years of -8.1, demonstrating that 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, HDSIX is a no load fund. It has an expense ratio of 1.02% compared to the category average of 1.08%. So, HDSIX is actually cheaper than its peers from a cost perspective.
While the minimum initial investment for the product is $1 million, investors should also note that each subsequent investment needs to be at least $100.
Bottom Line
Overall, Hodges Small Cap Fund Institutional Class ( HDSIX ) has a low Zacks Mutual Fund rank, and in conjunction with its comparatively weak performance, average downside risk, and lower fees, this fund looks like a somewhat weak choice for investors right now.
This could just be the start of your research on HDSIXin the All 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. 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 Hodges Small Cap Fund Institutional Class (HDSIX) a Strong Mutual Fund Pick Right Now?
If you have been looking for All Cap Growth funds, it would not be wise to start your search with Hodges Small Cap Fund Institutional Class (HDSIX - Free Report) . HDSIX has a Zacks Mutual Fund Rank of 4 (Sell), which is based on nine forecasting factors like size, cost, and past performance.
Objective
We note that HDSIX is an All Cap Growth option, and is loaded with different selections. All Cap Growth mutual funds look to invest in a wide variety of equities, no matter the size of the company and as long as the firm exhibits growth characteristics. In order to increase diversification, these portfolios have holdings across small, medium, and large-cap levels.
History of Fund/Manager
Hodges Capital is based in Dallas, TX, and is the manager of HDSIX. Since Hodges Small Cap Fund Institutional Class made its debut in December of 2008, HDSIX has garnered more than $99.77 million in assets. The fund is currently managed by a team of investment professionals.
Performance
Of course, investors look for strong performance in funds. This fund in particular has delivered a 5-year annualized total return of 0.85%, and it sits 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 2.31%, which places it in the bottom 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, HDSIX's standard deviation comes in at 17.78%, compared to the category average of 11.5%. The fund's standard deviation over the past 5 years is 16.33% compared to the category average of 11.46%. This makes the fund more volatile than its peers over the past half-decade.
Risk Factors
One cannot ignore the volatility of this segment, however, as it is always important for investors to remember the downside to any potential investment.
Even still, the fund has a 5-year beta of 1.23, so investors should note that it is hypothetically more volatile than the market at large. 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. HDSIX has generated a negative alpha over the past five years of -8.1, demonstrating that 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, HDSIX is a no load fund. It has an expense ratio of 1.02% compared to the category average of 1.08%. So, HDSIX is actually cheaper than its peers from a cost perspective.
While the minimum initial investment for the product is $1 million, investors should also note that each subsequent investment needs to be at least $100.
Bottom Line
Overall, Hodges Small Cap Fund Institutional Class ( HDSIX ) has a low Zacks Mutual Fund rank, and in conjunction with its comparatively weak performance, average downside risk, and lower fees, this fund looks like a somewhat weak choice for investors right now.
This could just be the start of your research on HDSIXin the All 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. 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.