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Is Parnassus Endeavor Fund (PARWX) a Strong Mutual Fund Pick Right Now?
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Any investors hoping to find a Large Cap Growth fund might consider looking past Parnassus Endeavor Fund (PARWX - Free Report) . PARWX bears a Zacks Mutual Fund Rank of 4 (Sell), which is based on nine forecasting factors like size, cost, and past performance.
Objective
PARWX 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
Parnassus is responsible for PARWX, and the company is based out of San Francisco, CA. Parnassus Endeavor Fund made its debut in April of 2005, and since then, PARWX has accumulated about $3.20 billion in assets, per the most up-to-date date available. The fund's current manager, Jerome L. Dodson, has been in charge of the fund since April of 2005.
Performance
Obviously, what investors are looking for in these funds is strong performance relative to their peers. This fund in particular has delivered a 5-year annualized total return of 11.73%, and is 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 13.21%, which places it in the bottom 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, PARWX's standard deviation comes in at 17.65%, compared to the category average of 11.39%. The fund's standard deviation over the past 5 years is 15.8% compared to the category average of 11.36%. 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. PARWX lost 43.15% in the most recent bear market and outperformed its peer group by 6%. This means that the fund could possibly be a better choice than its peers during a down market environment.
Investors should not forget about beta, an important way to measure a mutual fund's risk compared to the market as a whole. PARWX has a 5-year beta of 1.21, which means it is likely to be more volatile than the market average. 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. PARWX has generated a negative alpha over the past five years of -1.34, demonstrating that managers in this portfolio find it difficult to pick 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.
Currently, this mutual fund is holding 79.17% stock in stocks, which have an average market capitalization of $108.19 billion. The fund has the heaviest exposure to the following market sectors:
Technology
Other
Turnover is 70.96%, which means this fund makes more trades in a given year than the average of comparable funds.
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, PARWX is a no load fund. It has an expense ratio of 0.95% compared to the category average of 1.05%. So, PARWX is actually cheaper than its peers from a cost perspective.
Investors need to be aware that with this product, the minimum initial investment is $2,000; each subsequent investment needs to be at least $50.
Bottom Line
Overall, Parnassus Endeavor Fund ( PARWX ) has a low Zacks Mutual Fund rank, and in conjunction with its comparatively similar performance, average downside risk, and lower fees, this fund looks like a somewhat weak 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. 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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Is Parnassus Endeavor Fund (PARWX) a Strong Mutual Fund Pick Right Now?
Any investors hoping to find a Large Cap Growth fund might consider looking past Parnassus Endeavor Fund (PARWX - Free Report) . PARWX bears a Zacks Mutual Fund Rank of 4 (Sell), which is based on nine forecasting factors like size, cost, and past performance.
Objective
PARWX 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
Parnassus is responsible for PARWX, and the company is based out of San Francisco, CA. Parnassus Endeavor Fund made its debut in April of 2005, and since then, PARWX has accumulated about $3.20 billion in assets, per the most up-to-date date available. The fund's current manager, Jerome L. Dodson, has been in charge of the fund since April of 2005.
Performance
Obviously, what investors are looking for in these funds is strong performance relative to their peers. This fund in particular has delivered a 5-year annualized total return of 11.73%, and is 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 13.21%, which places it in the bottom 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, PARWX's standard deviation comes in at 17.65%, compared to the category average of 11.39%. The fund's standard deviation over the past 5 years is 15.8% compared to the category average of 11.36%. 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. PARWX lost 43.15% in the most recent bear market and outperformed its peer group by 6%. This means that the fund could possibly be a better choice than its peers during a down market environment.
Investors should not forget about beta, an important way to measure a mutual fund's risk compared to the market as a whole. PARWX has a 5-year beta of 1.21, which means it is likely to be more volatile than the market average. 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. PARWX has generated a negative alpha over the past five years of -1.34, demonstrating that managers in this portfolio find it difficult to pick 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.
Currently, this mutual fund is holding 79.17% stock in stocks, which have an average market capitalization of $108.19 billion. The fund has the heaviest exposure to the following market sectors:
- Technology
- Other
Turnover is 70.96%, which means this fund makes more trades in a given year than the average of comparable funds.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, PARWX is a no load fund. It has an expense ratio of 0.95% compared to the category average of 1.05%. So, PARWX is actually cheaper than its peers from a cost perspective.
Investors need to be aware that with this product, the minimum initial investment is $2,000; each subsequent investment needs to be at least $50.
Bottom Line
Overall, Parnassus Endeavor Fund ( PARWX ) has a low Zacks Mutual Fund rank, and in conjunction with its comparatively similar performance, average downside risk, and lower fees, this fund looks like a somewhat weak 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. 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.