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Is Franklin Gold & Precious Metals A (FKRCX) a Strong Mutual Fund Pick Right Now?
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Any investors hoping to find a Sector - Precious Metal fund could think about starting with Franklin Gold & Precious Metals A (FKRCX - Free Report) . FKRCX carries a Zacks Mutual Fund Rank of 1 (Strong Buy), which is based on nine forecasting factors like size, cost, and past performance.
Objective
We note that FKRCX is a Sector - Precious Metal option, and this area is loaded with different options. Sector - Precious Metal funds typically invest in companies that are involved in the mining and production of precious metals like gold, silver, platinum, and palladium. Because stocks in this environment often trade as leveraged bets of the underlying commodity--they are tied to the prices of the metal--these equities tend to be volatile.
History of Fund/Manager
Franklin Templeton is responsible for FKRCX, and the company is based out of San Mateo, CA. Franklin Gold & Precious Metals A made its debut in May of 1969, and since then, FKRCX has accumulated about $43.62 million in assets, per the most up-to-date date available. The fund's current manager, Steve M. Land, has been in charge of the fund since April of 1999.
Performance
Investors naturally seek funds with strong performance. This fund carries a 5-year annualized total return of -3.6%, and is in the top third among its category peers. Investors who prefer analyzing shorter time frames should look at its 3-year annualized total return of -7.73%, 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 13.61%, the standard deviation of FKRCX over the past three years is 25.52%. Looking at the past 5 years, the fund's standard deviation is 33.64% compared to the category average of 15.91%. 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. FKRCX lost 37.73% in the most recent bear market and underperformed its peer group by 1.9%. This could mean that the fund is a worse choice than comparable funds during a bear market.
Nevertheless, investors should also note that the fund has a 5-year beta of 0.15, which means it is hypothetically less volatile than the market at large. 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. FKRCX has generated a negative alpha over the past five years of -0.71, demonstrating that managers in this portfolio find it difficult to pick securities that generate better-than-benchmark returns.
Expenses
As competition heats up in the mutual fund market, costs become increasingly important. Compared to its otherwise identical counterpart, a low-cost product will be an outperformer, all other things being equal. Thus, taking a closer look at cost-related metrics is vital for investors. In terms of fees, FKRCX is a load fund. It has an expense ratio of 1% compared to the category average of 1.37%. FKRCX is actually cheaper than its peers when you consider factors like cost.
Investors need to be aware that with this product, the minimum initial investment is $1,000; each subsequent investment has no minimum amount.
Bottom Line
Overall, Franklin Gold & Precious Metals A ( FKRCX ) has a high Zacks Mutual Fund rank, strong performance, worse downside risk, and lower fees compared to its peers.
For additional information on this product, or to compare it to other mutual funds in the Sector - Precious Metal, make sure to go to www.zacks.com/funds/mutual-funds 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 Franklin Gold & Precious Metals A (FKRCX) a Strong Mutual Fund Pick Right Now?
Any investors hoping to find a Sector - Precious Metal fund could think about starting with Franklin Gold & Precious Metals A (FKRCX - Free Report) . FKRCX carries a Zacks Mutual Fund Rank of 1 (Strong Buy), which is based on nine forecasting factors like size, cost, and past performance.
Objective
We note that FKRCX is a Sector - Precious Metal option, and this area is loaded with different options. Sector - Precious Metal funds typically invest in companies that are involved in the mining and production of precious metals like gold, silver, platinum, and palladium. Because stocks in this environment often trade as leveraged bets of the underlying commodity--they are tied to the prices of the metal--these equities tend to be volatile.
History of Fund/Manager
Franklin Templeton is responsible for FKRCX, and the company is based out of San Mateo, CA. Franklin Gold & Precious Metals A made its debut in May of 1969, and since then, FKRCX has accumulated about $43.62 million in assets, per the most up-to-date date available. The fund's current manager, Steve M. Land, has been in charge of the fund since April of 1999.
Performance
Investors naturally seek funds with strong performance. This fund carries a 5-year annualized total return of -3.6%, and is in the top third among its category peers. Investors who prefer analyzing shorter time frames should look at its 3-year annualized total return of -7.73%, 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 13.61%, the standard deviation of FKRCX over the past three years is 25.52%. Looking at the past 5 years, the fund's standard deviation is 33.64% compared to the category average of 15.91%. 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. FKRCX lost 37.73% in the most recent bear market and underperformed its peer group by 1.9%. This could mean that the fund is a worse choice than comparable funds during a bear market.
Nevertheless, investors should also note that the fund has a 5-year beta of 0.15, which means it is hypothetically less volatile than the market at large. 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. FKRCX has generated a negative alpha over the past five years of -0.71, demonstrating that managers in this portfolio find it difficult to pick securities that generate better-than-benchmark returns.
Expenses
As competition heats up in the mutual fund market, costs become increasingly important. Compared to its otherwise identical counterpart, a low-cost product will be an outperformer, all other things being equal. Thus, taking a closer look at cost-related metrics is vital for investors. In terms of fees, FKRCX is a load fund. It has an expense ratio of 1% compared to the category average of 1.37%. FKRCX is actually cheaper than its peers when you consider factors like cost.
Investors need to be aware that with this product, the minimum initial investment is $1,000; each subsequent investment has no minimum amount.
Bottom Line
Overall, Franklin Gold & Precious Metals A ( FKRCX ) has a high Zacks Mutual Fund rank, strong performance, worse downside risk, and lower fees compared to its peers.
For additional information on this product, or to compare it to other mutual funds in the Sector - Precious Metal, make sure to go to www.zacks.com/funds/mutual-funds 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.