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Is Alger Small Cap Focus A (AOFAX) a Strong Mutual Fund Pick Right Now?
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If investors are looking at the Small Cap Growth fund category, make sure to pass over Alger Small Cap Focus A (AOFAX - Free Report) . AOFAX holds a Zacks Mutual Fund Rank of 4 (Sell), which is based on nine forecasting factors like size, cost, and past performance.
Objective
AOFAX is one of many different Small Cap Growth funds to choose from. Small Cap Growth mutual funds build portfolios around stocks with markets caps under $2 billion and large growth opportunities. Additionally, these portfolios typically highlight smaller companies in promising markets and industries.
History of Fund/Manager
Alger Funds is responsible for AOFAX, and the company is based out of New York, NY. Since Alger Small Cap Focus A made its debut in March of 2008, AOFAX has garnered more than $300.07 million in assets. Amy Y. Zhang is the fund's current manager and has held that role since February of 2015.
Performance
Investors naturally seek funds with strong performance. This fund has delivered a 5-year annualized total return of 15.94%, and is in the top 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 27.72%, 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. Compared to the category average of 10.63%, the standard deviation of AOFAX over the past three years is 18.81%. Looking at the past 5 years, the fund's standard deviation is 17.88% compared to the category average of 11.04%. This makes the fund more volatile than its peers over the past half-decade.
Risk Factors
It's always important to be aware of the downsides to any future investment, so one should not discount the risks that come with this segment.
Even still, the fund has a 5-year beta of 1.22, 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. AOFAX has generated a positive alpha over the past five years of 2.43, demonstrating that managers in this portfolio are skilled in picking 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, AOFAX is a load fund. It has an expense ratio of 1.18% compared to the category average of 1.22%. So, AOFAX is actually cheaper than its peers from a cost perspective.
Investors need to be aware that with this product, the minimum initial investment is $1,000; each subsequent investment needs to be at least $50.
Bottom Line
Overall, Alger Small Cap Focus A ( AOFAX ) has a low Zacks Mutual Fund rank, strong performance, worse downside risk, and lower fees compared to its peers.
Want even more information about AOFAX? Then go over to Zacks.com and check out our mutual fund comparison tool, and all of the other great features that we have to help you with your mutual fund analysis 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 Alger Small Cap Focus A (AOFAX) a Strong Mutual Fund Pick Right Now?
If investors are looking at the Small Cap Growth fund category, make sure to pass over Alger Small Cap Focus A (AOFAX - Free Report) . AOFAX holds a Zacks Mutual Fund Rank of 4 (Sell), which is based on nine forecasting factors like size, cost, and past performance.
Objective
AOFAX is one of many different Small Cap Growth funds to choose from. Small Cap Growth mutual funds build portfolios around stocks with markets caps under $2 billion and large growth opportunities. Additionally, these portfolios typically highlight smaller companies in promising markets and industries.
History of Fund/Manager
Alger Funds is responsible for AOFAX, and the company is based out of New York, NY. Since Alger Small Cap Focus A made its debut in March of 2008, AOFAX has garnered more than $300.07 million in assets. Amy Y. Zhang is the fund's current manager and has held that role since February of 2015.
Performance
Investors naturally seek funds with strong performance. This fund has delivered a 5-year annualized total return of 15.94%, and is in the top 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 27.72%, 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. Compared to the category average of 10.63%, the standard deviation of AOFAX over the past three years is 18.81%. Looking at the past 5 years, the fund's standard deviation is 17.88% compared to the category average of 11.04%. This makes the fund more volatile than its peers over the past half-decade.
Risk Factors
It's always important to be aware of the downsides to any future investment, so one should not discount the risks that come with this segment.
Even still, the fund has a 5-year beta of 1.22, 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. AOFAX has generated a positive alpha over the past five years of 2.43, demonstrating that managers in this portfolio are skilled in picking 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, AOFAX is a load fund. It has an expense ratio of 1.18% compared to the category average of 1.22%. So, AOFAX is actually cheaper than its peers from a cost perspective.
Investors need to be aware that with this product, the minimum initial investment is $1,000; each subsequent investment needs to be at least $50.
Bottom Line
Overall, Alger Small Cap Focus A ( AOFAX ) has a low Zacks Mutual Fund rank, strong performance, worse downside risk, and lower fees compared to its peers.
Want even more information about AOFAX? Then go over to Zacks.com and check out our mutual fund comparison tool, and all of the other great features that we have to help you with your mutual fund analysis 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.