If you've been stuck searching for Mid Cap Growth funds, you might want to consider passing on by Scout Mid Cap Fund (UMBMX Quick QuoteUMBMX - Free Report) as a possibility. UMBMX carries a Zacks Mutual Fund Rank of 4 (Sell), which is based on nine forecasting factors like size, cost, and past performance.

Objective

Zacks categorizes UMBMX as Mid Cap Growth, a segment packed with options. Mid Cap Growth mutual funds aim to target companies with a market capitalization between $2 billion and $10 billion that are also expected to exhibit more extensive growth opportunities for investors than their peers. A firm is typically considered to be a growth stock if it consistently posts impressive sales and/or earnings growth.

History of Fund/Manager

Eagle Funds is based in St. Petersburg, FL, and is the manager of UMBMX. The Scout Mid Cap Fund made its debut in November of 2006 and UMBMX has managed to accumulate roughly $2.68 billion in assets, as of the most recently available information. A team of investment professionals is the fund's current manager.

Performance

Of course, investors look for strong performance in funds. UMBMX has a 5-year annualized total return of 9.39% and it sits in the bottom 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 11.47%, 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, UMBMX's standard deviation comes in at 14.22%, compared to the category average of 14.71%. The standard deviation of the fund over the past 5 years is 12.73% compared to the category average of 14.22%. This makes the fund less 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 UMBMX's case, the fund lost 46.03% in the most recent bear market and outperformed its peer group by 6%. This makes the fund a possibly better choice than its peers during a sliding market environment.

Even still, the fund has a 5-year beta of 0.98, so investors should note that it is hypothetically as volatile as 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. Over the past 5 years, the fund has a negative alpha of -0.99. This means that managers in this portfolio find it difficult to pick securities that generate better-than-benchmark returns.

Holdings

Investigating 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 mostly on equities that are traded in the United States.

Right now, 94.52% of this mutual fund's holdings are stocks, and these companies have an average market capitalization of $15.63 billion. The fund has the heaviest exposure to the following market sectors:

1. Finance
2. Technology
3. Industrial Cyclical
4. Other
5. Retail Trade

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, UMBMX is a no load fund. It has an expense ratio of 0.97% compared to the category average of 1.21%. So, UMBMX is actually cheaper than its peers from a cost perspective.

This fund requires a minimum initial investment of $10,000, while there is no minimum for each subsequent investment.

Bottom Line

Overall, Scout Mid Cap Fund ( UMBMX ) has a low Zacks Mutual Fund rank, and in conjunction with its comparatively weak performance, average downside risk, and lower fees, Scout Mid Cap Fund ( UMBMX ) looks like a somewhat weak choice for investors right now.

For additional information on the Mid Cap Growth area of the mutual fund world, make sure to check out www.zacks.com/funds/mutual-funds. There, you can see more about the ranking process, and dive even deeper into UMBMX too 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.