Any investors hoping to find a Mutual Fund Equity Report fund could think about starting with MFS Growth Fund A (MFEGX). MFEGX holds a Zacks Mutual Fund Rank of 1 (Strong Buy), which is based on nine forecasting factors like size, cost, and past performance.
History of Fund/Manager
MFS is based in Boston, MA, and is the manager of MFEGX. The MFS Growth Fund A made its debut in December of 1986 and MFEGX has managed to accumulate roughly $10.32 billion in assets, as of the most recently available information. The fund’s current manager is a team of investment professionals.
Of course, investors look for strong performance in funds. This fund in particular has delivered a 5-year annualized total return of 24.05%, 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 26.38%, which places it in the middle 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. MFEGX’s standard deviation over the past three years is 17.74% compared to the category average of 15.32%. Looking at the past 5 years, the fund’s standard deviation is 15.51% compared to the category average of 12.98%. This makes the fund more volatile than its peers over the past half-decade.
Investors should note that the fund has a 5-year beta of 0.94, 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. With a positive alpha of 6.36, managers in this portfolio are skilled in picking securities that generate better-than-benchmark returns.
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 principally on equities that are traded in the United States.
Currently, this mutual fund is holding 83.8% stock in stocks, which have an average market capitalization of $638.38 billion. The fund has the heaviest exposure to the following market sectors:
Turnover is about 14%, so those in charge of the fund make fewer trades than the average comparable fund.
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, MFEGX is a load fund. It has an expense ratio of 0.83% compared to the category average of 1.01%. Looking at the fund from a cost perspective, MFEGX is actually cheaper than its peers.
Investors need to be aware that with this product, the minimum initial investment is $1,000; each subsequent investment needs to be at least $50.
Overall, MFS Growth Fund A ( MFEGX ) has a high Zacks Mutual Fund rank, and in conjunction with its comparatively strong performance, average downside risk, and lower fees, MFS Growth Fund A ( MFEGX ) looks like a good potential choice for investors right now.
For additional information on this product, or to compare it to other mutual funds in the Mutual Fund Equity Report, make sure to go to www.zacks.com/funds/mutual-funds 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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