Is American Funds New Perspective A (ANWPX) a Strong Mutual Fund Pick Right Now?

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On the lookout for a Global – Equity fund? Starting with American Funds New Perspective A (ANWPX) is one possibility. ANWPX carries a Zacks Mutual Fund Rank of 2 (Buy), which is based on nine forecasting factors like size, cost, and past performance.

Load Error

Objective

We note that ANWPX is a Global – Equity option, an investment area loaded with different options. While Global – Equity mutual funds invest their assets in large markets–think the U.S., Europe, and Japan–they aren’t limited by geography. Their investment technique is one that leverages the global economy in order to offer stable returns.

History of Fund/Manager

American Funds is based in Los Angeles, CA, and is the manager of ANWPX. American Funds New Perspective A made its debut in March of 1973, and since then, ANWPX has accumulated about $60.21 billion in assets, per the most up-to-date date available. The fund is currently managed by a team of investment professionals.

Performance

Investors naturally seek funds with strong performance. ANWPX has a 5-year annualized total return of 19.21% 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 20.2%, 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. The standard deviation of ANWPX over the past three years is 19% compared to the category average of 15.23%. Over the past 5 years, the standard deviation of the fund is 15.39% compared to the category average of 12.55%. This makes the fund more volatile than its peers over the past half-decade.

Risk Factors

Investors should note that the fund has a 5-year beta of 0.97, which means it is hypothetically as volatile as the market at large. 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. ANWPX has generated a positive alpha over the past five years of 1.62, demonstrating that managers in this portfolio are skilled in picking 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, ANWPX is a load fund. It has an expense ratio of 0.73% compared to the category average of 1.13%. From a cost perspective, ANWPX is actually cheaper than its peers.

This fund requires a minimum initial investment of $250, and each subsequent investment should be at least $50.

Bottom Line

Overall, American Funds New Perspective A ( ANWPX ) has a high Zacks Mutual Fund rank, and in conjunction with its comparatively strong performance, average downside risk, and lower fees, American Funds New Perspective A ( ANWPX ) looks like a good potential choice for investors right now.

For additional information on the Global – Equity 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 ANWPX 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.

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