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Is AQR Large Cap Defensive Style I (AUEIX) a Strong Mutual Fund Pick Right Now?
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If you have been looking for Large Cap Blend funds, a place to start could be AQR Large Cap Defensive Style I (AUEIX - Free Report) . AUEIX has a Zacks Mutual Fund Rank of 1 (Strong Buy), which is based on nine forecasting factors like size, cost, and past performance.
Objective
AUEIX is part of the Large Cap Blend section, an area that boasts an array of many possible options. Large Cap Blend mutual funds most often invest in firms with a market capitalization of $10 billion or more. By investing in bigger companies, these funds offer more stability, and are often well-suited for investors with a " buy and hold " mindset. Blended funds mix large, established companies into their holdings, which gives investors exposure to both value and growth at the same time.
History of Fund/Manager
AQR Funds is based in Denver, CO, and is the manager of AUEIX. AQR Large Cap Defensive Style I made its debut in July of 2012, and since then, AUEIX has accumulated about $2.20 billion in assets, per the most up-to-date date available. The fund's current manager is a team of investment professionals.
Performance
Investors naturally seek funds with strong performance. This fund in particular has delivered a 5-year annualized total return of 13.08%, 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 16.15%, 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. Looking at the past 5 years, the fund's standard deviation is 9.85% compared to the category average of 1.03%. This makes the fund more volatile than its peers over the past half-decade.
Risk Factors
Investors should always remember the downsides to a potential investment, and this segment carries some risks one should be aware of.
Nevertheless, investors should also note that the fund has a 5-year beta of 0.78, which means it is hypothetically less volatile than the market at large. Another factor to consider is alpha, as it reflects a portfolio's performance on a risk-adjusted basis relative to a benchmark-in this case, the S&P 500. AUEIX's 5-year performance has produced a positive alpha of 4.1, which means managers in this portfolio are skilled in picking securities that generate better-than-benchmark returns.
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, AUEIX is a no load fund and it has an expense ratio of 0.40%.
This fund requires a minimum initial investment of $5 million, while there is no minimum for each subsequent investment.
Bottom Line
This puts this fund from AQR Funds in the top 20% of all mutual funds we have a rank on right now. As a result, this is likely an excellent choice for investors seeking an option in the Large Cap Blend category.
For additional information on this product, or to compare it to other mutual funds in the Large Cap Blend, make sure to go to www.zacks.com/funds/mutual-funds for additional information. If you want to check out our stock reports as well, make sure to go to Zacks.com to see all of the great tools we have to offer, including our time-tested Zacks Rank.
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Is AQR Large Cap Defensive Style I (AUEIX) a Strong Mutual Fund Pick Right Now?
If you have been looking for Large Cap Blend funds, a place to start could be AQR Large Cap Defensive Style I (AUEIX - Free Report) . AUEIX has a Zacks Mutual Fund Rank of 1 (Strong Buy), which is based on nine forecasting factors like size, cost, and past performance.
Objective
AUEIX is part of the Large Cap Blend section, an area that boasts an array of many possible options. Large Cap Blend mutual funds most often invest in firms with a market capitalization of $10 billion or more. By investing in bigger companies, these funds offer more stability, and are often well-suited for investors with a " buy and hold " mindset. Blended funds mix large, established companies into their holdings, which gives investors exposure to both value and growth at the same time.
History of Fund/Manager
AQR Funds is based in Denver, CO, and is the manager of AUEIX. AQR Large Cap Defensive Style I made its debut in July of 2012, and since then, AUEIX has accumulated about $2.20 billion in assets, per the most up-to-date date available. The fund's current manager is a team of investment professionals.
Performance
Investors naturally seek funds with strong performance. This fund in particular has delivered a 5-year annualized total return of 13.08%, 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 16.15%, 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. Looking at the past 5 years, the fund's standard deviation is 9.85% compared to the category average of 1.03%. This makes the fund more volatile than its peers over the past half-decade.
Risk Factors
Investors should always remember the downsides to a potential investment, and this segment carries some risks one should be aware of.
Nevertheless, investors should also note that the fund has a 5-year beta of 0.78, which means it is hypothetically less volatile than the market at large. Another factor to consider is alpha, as it reflects a portfolio's performance on a risk-adjusted basis relative to a benchmark-in this case, the S&P 500. AUEIX's 5-year performance has produced a positive alpha of 4.1, which means managers in this portfolio are skilled in picking securities that generate better-than-benchmark returns.
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, AUEIX is a no load fund and it has an expense ratio of 0.40%.
This fund requires a minimum initial investment of $5 million, while there is no minimum for each subsequent investment.
Bottom Line
This puts this fund from AQR Funds in the top 20% of all mutual funds we have a rank on right now. As a result, this is likely an excellent choice for investors seeking an option in the Large Cap Blend category.
For additional information on this product, or to compare it to other mutual funds in the Large Cap Blend, make sure to go to www.zacks.com/funds/mutual-funds for additional information. If you want to check out our stock reports as well, make sure to go to Zacks.com to see all of the great tools we have to offer, including our time-tested Zacks Rank.