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Is Franklin Real Estate Security A (FREEX) a Strong Mutual Fund Pick Right Now?
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If you have been looking for Sector - Real Estate fund category, a potential starting could be Franklin Real Estate Security A (FREEX - Free Report) . FREEX has a Zacks Mutual Fund Rank of 3 (Hold), which is based on nine forecasting factors like size, cost, and past performance.
Objective
Zacks categorizes FREEX in Sector - Real Estate, which is a segment packed with options. Real estate investment trusts (REITs) are a popular income vehicle thanks their taxation rules, and Sector - Real Estate mutual funds typically invest in them. A REIT is required to pay out at least 90% of its income annually to avoid double taxation, and this technique makes securities in these funds high dividend players--almost bond-like in some cases--though their risk is similar to equities.
History of Fund/Manager
Franklin Templeton is based in San Mateo, CA, and is the manager of FREEX. The Franklin Real Estate Security A made its debut in January of 1994 and FREEX has managed to accumulate roughly $333.52 million in assets, as of the most recently available information. The fund's current manager is a team of investment professionals.
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 7.37%, and is 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 5.71%, 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, FREEX's standard deviation comes in at 13.71%, compared to the category average of 9.63%. Over the past 5 years, the standard deviation of the fund is 14.59% compared to the category average of 10.1%. 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. In FREEX's case, the fund lost 65.34% in the most recent bear market and underperformed its peer group by 1.45%. This means that the fund could possibly be a worse choice than its peers during a down market environment.
Nevertheless, with a 5-year beta of 0.62, the fund 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. With a positive alpha of 1.67, 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, FREEX is a load fund. It has an expense ratio of 0.98% compared to the category average of 1.22%. So, FREEX is actually cheaper than its peers from a cost perspective.
While the minimum initial investment for the product is $1,000, investors should also note that there is no minimum for each subsequent investment.
Bottom Line
Overall, Franklin Real Estate Security A ( FREEX ) has a neutral Zacks Mutual Fund rank, strong performance, average downside risk, and lower fees compared to its peers.
Don't stop here for your research on Sector - Real Estate funds. We also have plenty more on our site in order to help you find the best possible fund for your portfolio. Make sure to check out www.zacks.com/funds/mutual-funds for more information about the world of funds, and feel free to compare FREEX to its peers as well for additional information. For analysis of the rest of your portfolio, make sure to visit Zacks.com for our full suite of tools which will help you investigate all of your stocks and funds in one place.
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Is Franklin Real Estate Security A (FREEX) a Strong Mutual Fund Pick Right Now?
If you have been looking for Sector - Real Estate fund category, a potential starting could be Franklin Real Estate Security A (FREEX - Free Report) . FREEX has a Zacks Mutual Fund Rank of 3 (Hold), which is based on nine forecasting factors like size, cost, and past performance.
Objective
Zacks categorizes FREEX in Sector - Real Estate, which is a segment packed with options. Real estate investment trusts (REITs) are a popular income vehicle thanks their taxation rules, and Sector - Real Estate mutual funds typically invest in them. A REIT is required to pay out at least 90% of its income annually to avoid double taxation, and this technique makes securities in these funds high dividend players--almost bond-like in some cases--though their risk is similar to equities.
History of Fund/Manager
Franklin Templeton is based in San Mateo, CA, and is the manager of FREEX. The Franklin Real Estate Security A made its debut in January of 1994 and FREEX has managed to accumulate roughly $333.52 million in assets, as of the most recently available information. The fund's current manager is a team of investment professionals.
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 7.37%, and is 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 5.71%, 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, FREEX's standard deviation comes in at 13.71%, compared to the category average of 9.63%. Over the past 5 years, the standard deviation of the fund is 14.59% compared to the category average of 10.1%. 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. In FREEX's case, the fund lost 65.34% in the most recent bear market and underperformed its peer group by 1.45%. This means that the fund could possibly be a worse choice than its peers during a down market environment.
Nevertheless, with a 5-year beta of 0.62, the fund 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. With a positive alpha of 1.67, 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, FREEX is a load fund. It has an expense ratio of 0.98% compared to the category average of 1.22%. So, FREEX is actually cheaper than its peers from a cost perspective.
While the minimum initial investment for the product is $1,000, investors should also note that there is no minimum for each subsequent investment.
Bottom Line
Overall, Franklin Real Estate Security A ( FREEX ) has a neutral Zacks Mutual Fund rank, strong performance, average downside risk, and lower fees compared to its peers.
Don't stop here for your research on Sector - Real Estate funds. We also have plenty more on our site in order to help you find the best possible fund for your portfolio. Make sure to check out www.zacks.com/funds/mutual-funds for more information about the world of funds, and feel free to compare FREEX to its peers as well for additional information. For analysis of the rest of your portfolio, make sure to visit Zacks.com for our full suite of tools which will help you investigate all of your stocks and funds in one place.