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Is Bridgeway Small Cap Value N (BRSVX) a Strong Mutual Fund Pick Right Now?

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If you've been stuck searching for Small Cap Value funds, consider Bridgeway Small Cap Value N (BRSVX - Free Report) as a possibility. BRSVX carries a Zacks Mutual Fund Rank of 2 (Buy), which is based on nine forecasting factors like size, cost, and past performance.

Objective

The world of Small Cap Value mutual funds is an area filled with options, such as BRSVX. Small Cap Value funds invest in small companies with stock market valuation less than $2 billion. These funds offer more bang for an owner's buck, providing low P/E ratios, high dividend yields, and better-than-average P/S ratios.

History of Fund/Manager

Bridgeway is responsible for BRSVX, and the company is based out of Houston, TX. Since Bridgeway Small Cap Value N made its debut in January of 2004, BRSVX has garnered more than $50.18 million in assets. The fund's current manager is a team of investment professionals.

Performance

Investors naturally seek funds with strong performance. This fund in particular has delivered a 5-year annualized total return of 1.51%, and is in the bottom third among its category peers. Investors who prefer analyzing shorter time frames should look at its 3-year annualized total return of 5.69%, 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. Over the past three years, BRSVX's standard deviation comes in at 16.69%, compared to the category average of 15.51%. Looking at the past 5 years, the fund's standard deviation is 16.13% compared to the category average of 14.86%. This makes the fund more volatile than its peers over the past half-decade.

Risk Factors

Investors should always remember the downsides to a potential investment, and this segment carries some risks one should be aware of. In BRSVX's case, the fund lost 60.33% in the most recent bear market and underperformed comparable funds by 9.27%. This makes the fund a possibly worse 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. 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. The fund has produced a negative alpha over the past 5 years of -6.63, which shows that managers in this portfolio find it difficult to pick securities that generate better-than-benchmark returns.

Expenses

For investors, taking a closer look at cost-related metrics is key, since costs are increasingly important for mutual fund investing. Competition is heating up in this space, and a lower cost product will likely outperform its otherwise identical counterpart, all things being equal. In terms of fees, BRSVX is a no load fund. It has an expense ratio of 0.94% compared to the category average of 1.25%. From a cost perspective, BRSVX is actually cheaper than its peers.

Investors need to be aware that with this product, the minimum initial investment is $2,000; each subsequent investment needs to be at least $100.

Bottom Line

Overall, Bridgeway Small Cap Value N ( BRSVX ) has a high Zacks Mutual Fund rank, and in conjunction with its comparatively weak performance, average downside risk, and lower fees, Bridgeway Small Cap Value N ( BRSVX ) looks like a great potential choice for investors right now.

This could just be the start of your research on BRSVXin the Small 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. If you want to check out our stock reports as well, make sure to go to Zacks.com to see all of the great tools we have to offer, including our time-tested Zacks Rank.


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