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Is Scout Mid Cap Fund (UMBMX) a Strong Mutual Fund Pick Right Now?
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There are plenty of choices in the Mid Cap Growth category, but where should you start your research? Well, one fund that you should consider investigating is Scout Mid Cap Fund (UMBMX - Free Report) . UMBMX possesses a Zacks Mutual Fund Rank of 3 (Hold), which is based on nine forecasting factors like size, cost, and past performance.
Objective
UMBMX is part of the Mid Cap Growth section, a segment that boasts a wide array of possible selections. While Mid Cap Growth mutual funds choose companies with a stock market valuation between $2 billion and $10 billion, stocks in these funds are also expected to show broad considerable growth opportunities for investors compared to their peers. To be considered a growth stock, companies must consistently report 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 $1.86 billion in assets, as of the most recently available information. A team of investment professionals is the fund's current manager.
Performance
Investors naturally seek funds with strong performance. UMBMX has a 5-year annualized total return of 2.72% and is in the bottom third among its category peers. Investors who prefer analyzing shorter time frames should look at its 3-year annualized total return of -1.34%, 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. Compared to the category average of 15.15%, the standard deviation of UMBMX over the past three years is 17.7%. The standard deviation of the fund over the past 5 years is 15.41% compared to the category average of 14.34%. 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. UMBMX lost 46.03% 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. UMBMX has a 5-year beta of 1.06, which means it is likely to be more 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. UMBMX's 5-year performance has produced a negative alpha of -3.88, which means 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.
The mutual fund currently has 98.53% of its holdings in stocks, with an average market capitalization of $16.89 billion. The fund has the heaviest exposure to the following market sectors:
Finance
Technology
Industrial Cyclical
Retail Trade
Turnover is 170%, which means this fund makes more traders than comparable funds in a given year.
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, UMBMX is a no load fund. It has an expense ratio of 0.98% compared to the category average of 1.20%. Looking at the fund from a cost perspective, UMBMX is actually cheaper than its peers.
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 neutral Zacks Mutual Fund rank, and in conjunction with its comparatively weak performance, average downside risk, and lower fees, this fund looks like a somewhat average 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. Zacks provides a full suite of tools to help you analyze your portfolio - both funds and stocks - in the most efficient way possible.
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Is Scout Mid Cap Fund (UMBMX) a Strong Mutual Fund Pick Right Now?
There are plenty of choices in the Mid Cap Growth category, but where should you start your research? Well, one fund that you should consider investigating is Scout Mid Cap Fund (UMBMX - Free Report) . UMBMX possesses a Zacks Mutual Fund Rank of 3 (Hold), which is based on nine forecasting factors like size, cost, and past performance.
Objective
UMBMX is part of the Mid Cap Growth section, a segment that boasts a wide array of possible selections. While Mid Cap Growth mutual funds choose companies with a stock market valuation between $2 billion and $10 billion, stocks in these funds are also expected to show broad considerable growth opportunities for investors compared to their peers. To be considered a growth stock, companies must consistently report 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 $1.86 billion in assets, as of the most recently available information. A team of investment professionals is the fund's current manager.
Performance
Investors naturally seek funds with strong performance. UMBMX has a 5-year annualized total return of 2.72% and is in the bottom third among its category peers. Investors who prefer analyzing shorter time frames should look at its 3-year annualized total return of -1.34%, 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. Compared to the category average of 15.15%, the standard deviation of UMBMX over the past three years is 17.7%. The standard deviation of the fund over the past 5 years is 15.41% compared to the category average of 14.34%. 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. UMBMX lost 46.03% 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. UMBMX has a 5-year beta of 1.06, which means it is likely to be more 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. UMBMX's 5-year performance has produced a negative alpha of -3.88, which means 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.
The mutual fund currently has 98.53% of its holdings in stocks, with an average market capitalization of $16.89 billion. The fund has the heaviest exposure to the following market sectors:
- Finance
- Technology
- Industrial Cyclical
- Retail Trade
Turnover is 170%, which means this fund makes more traders than comparable funds in a given year.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, UMBMX is a no load fund. It has an expense ratio of 0.98% compared to the category average of 1.20%. Looking at the fund from a cost perspective, UMBMX is actually cheaper than its peers.
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 neutral Zacks Mutual Fund rank, and in conjunction with its comparatively weak performance, average downside risk, and lower fees, this fund looks like a somewhat average 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. Zacks provides a full suite of tools to help you analyze your portfolio - both funds and stocks - in the most efficient way possible.