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Is Oppenheimer Developing Markets I (ODVIX) a Strong Mutual Fund Pick Right Now?

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On the lookout for a Non US - Equity fund? Starting with Oppenheimer Developing Markets I (ODVIX - Free Report) is one possibility. ODVIX bears a Zacks Mutual Fund Rank of 2 (Buy), which is based on nine forecasting factors like size, cost, and past performance.

Objective

We classify ODVIX in the Non US - Equity category, which is an area rife with potential choices. Investing in companies outside the United States is how Non US - Equity funds set themselves apart, since global funds tend to keep a good portion of their portfolio stateside. Many of these funds like to allocate across emerging and developed markets, and will often focus on all cap levels.

History of Fund/Manager

Oppenheimer is based in Denver, CO, and is the manager of ODVIX. The Oppenheimer Developing Markets I made its debut in December of 2011 and ODVIX has managed to accumulate roughly $16.77 billion in assets, as of the most recently available information. The fund's current manager, Justin Leverenz, has been in charge of the fund since December of 2011.

Performance

Obviously, what investors are looking for in these funds is strong performance relative to their peers. This fund has delivered a 5-year annualized total return of 4.5%, 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 13.04%, 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 ODVIX over the past three years is 12.34% compared to the category average of 9.53%. The standard deviation of the fund over the past 5 years is 14.38% compared to the category average of 9.99%. This makes the fund more volatile than its peers over the past half-decade.

Risk Factors

Investors cannot discount the risks to this segment though, as it is always important to remember the downside for any potential investment.

Investors should not forget about beta, an important way to measure a mutual fund's risk compared to the market as a whole. ODVIX has a 5-year beta of 0.9, which means it 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. ODVIX has generated a negative alpha over the past five years of -5.04, demonstrating that 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, ODVIX is a no load fund. It has an expense ratio of 0.87% compared to the category average of 1.20%. So, ODVIX 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 there is no minimum for each subsequent investment.

Bottom Line

Overall, Oppenheimer Developing Markets I ( ODVIX ) has a high Zacks Mutual Fund rank, similar performance, average downside risk, and lower fees compared to its peers.

Your research on the Non US - Equity segment doesn't have to stop here. You can check out all the great mutual fund tools we have to offer by going to www.zacks.com/funds/mutual-funds to see the additional features we offer as well for additional information. Want to learn even more? We have a full suite of tools on stocks that you can use to find the best choices for your portfolio too, no matter what kind of investor you are.


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