Back to top

Is ClearBridge Large Cap Growth A (SBLGX) a Strong Mutual Fund Pick Right Now?

Read MoreHide Full Article

Having trouble finding a Large Cap Growth fund? ClearBridge Large Cap Growth A (SBLGX - Free Report) is a potential starting point. SBLGX possesses a Zacks Mutual Fund Rank of 2 (Buy), which is based on nine forecasting factors like size, cost, and past performance.

Objective

SBLGX is classified in the Large Cap Growth segment by Zacks, an area full of possibilities. Companies are usually considered to be large-cap if their stock market valuation is more than $10 billion. Large Cap Growth mutual funds invest in many large U.S. firms that are projected to grow at a faster rate than their large-cap peers.

History of Fund/Manager

SBLGX finds itself in the Legg Mason family, based out of Baltimore, MD. ClearBridge Large Cap Growth A debuted in August of 1997. Since then, SBLGX has accumulated assets of about $1.89 billion, according to the most recently available information. The fund's current manager, Peter Bourbeau, has been in charge of the fund since July of 2009.

Performance

Investors naturally seek funds with strong performance. This fund has delivered a 5-year annualized total return of 10.47%, and it sits in the top 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 10.01%, 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. The standard deviation of SBLGX over the past three years is 11.58% compared to the category average of 9.76%. The standard deviation of the fund over the past 5 years is 11.43% compared to the category average of 9.64%. 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. In the most recent bear market, SBLGX lost 46.03% and outperformed its peer group by 2.81%. This might suggest that the fund is a better choice than its peers during a bear market.

Investors should note that the fund has a 5-year beta of 1, so it is likely going to be as volatile as 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. With a positive alpha of 1.93, managers in this portfolio are skilled in picking 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.

Right now, 87.53% of this mutual fund's holdings are stocks, with an average market capitalization of $280.46 billion. The fund has the heaviest exposure to the following market sectors:

  1. Technology
  2. Other
  3. Retail Trade
  4. Finance
With turnover at about 18%, this fund makes fewer trades than the average comparable fund.

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, SBLGX is a load fund. It has an expense ratio of 1.03% compared to the category average of 1.05%. SBLGX is actually cheaper than its peers when you consider factors like cost.

Investors should also note that the minimum initial investment for the product is $1,000 and that each subsequent investment needs to be at $50.

Bottom Line

Overall, ClearBridge Large Cap Growth A ( SBLGX ) has a high Zacks Mutual Fund rank, and in conjunction with its comparatively strong performance, average downside risk, and lower fees, ClearBridge Large Cap Growth A ( SBLGX ) looks like a good potential choice for investors right now.

For additional information on this product, or to compare it to other mutual funds in the Large Cap Growth, make sure to go to www.zacks.com/funds/mutual-funds 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.




In-Depth Zacks Research for the Tickers Above


Normally $25 each - click below to receive one report FREE:


ClearBridge Large Cap Growth A (SBLGX) - free report >>

More from Zacks Mutual Fund Equity Report

You May Like

Published in