If you’ve been stuck searching for Mutual Fund Equity Report funds, you might want to consider passing on by Homestead Growth (HNASX) as a possibility. HNASX possesses a Zacks Mutual Fund Rank of 5 (Strong Sell), which is based on nine forecasting factors like size, cost, and past performance.
History of Fund/Manager
Homestead is based in Arlington, VA, and is the manager of HNASX. Homestead Growth made its debut in June of 2004, and since then, HNASX has accumulated about $326.11 million in assets, per the most up-to-date date available. Taymour Tamaddon is the fund’s current manager and has held that role since January of 2017.
Of course, investors look for strong performance in funds. This fund carries a 5-year annualized total return of 18.99%, and is in the top third among its category peers. Investors who prefer analyzing shorter time frames should look at its 3-year annualized total return of 17.21%, 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. HNASX’s standard deviation over the past three years is 19.31% compared to the category average of 19.74%. Looking at the past 5 years, the fund’s standard deviation is 17.53% compared to the category average of 17.78%. This makes the fund less volatile than its peers over the past half-decade.
The fund has a 5-year beta of 1.03, so investors should note that 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. Over the past 5 years, the fund has a positive alpha of 2.39. This means that managers in this portfolio are skilled in picking securities that generate better-than-benchmark returns.
Examining 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.
As of the last filing date, the mutual fund has 90.93% of its assets in stocks, with an average market capitalization of $733.29 billion. The fund has the heaviest exposure to the following market sectors:
Turnover is 26%, which means, on average, the fund makes fewer trades than the average comparable fund.
For investors, taking a closer look at cost-related metrics is key, since costs are increasingly important for mutual fund investing. Competition is heating up in this space, and a lower cost product will likely outperform its otherwise identical counterpart, all things being equal. In terms of fees, HNASX is a no load fund. It has an expense ratio of 0.84% compared to the category average of 0.78%. So, HNASX is actually more expensive than its peers from a cost perspective.
This fund requires a minimum initial investment of $500, while there is no minimum for each subsequent investment.
Overall, Homestead Growth ( HNASX ) has a low Zacks Mutual Fund rank, and in conjunction with its comparatively strong performance, average downside risk, and higher fees, this fund looks like a poor potential choice for investors right now.
For additional information on the Mutual Fund Equity Report 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 HNASX too 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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