Is Matthews Asia Growth Fund Investor (MPACX) a Strong Mutual Fund Pick Right Now?

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On the lookout for a Mutual Fund Equity Report fund? Starting with Matthews Asia Growth Fund Investor (MPACX) should not be a possibility at this time. MPACX holds a Zacks Mutual Fund Rank of 4 (Sell), which is based on nine forecasting factors like size, cost, and past performance.

History of Fund/Manager

Matthews Asia is based in San Francisco, CA, and is the manager of MPACX. Matthews Asia Growth Fund Investor made its debut in October of 2003, and since then, MPACX has accumulated about $568 million in assets, per the most up-to-date date available. Taizo Ishida is the fund’s current manager and has held that role since January of 2007.

Performance

Investors naturally seek funds with strong performance. This fund has delivered a 5-year annualized total return of 1.13%, and it sits in the bottom 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 -1.61%, 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. The standard deviation of MPACX over the past three years is 21.64% compared to the category average of 16.63%. The fund’s standard deviation over the past 5 years is 19.9% compared to the category average of 15.11%. This makes the fund more volatile than its peers over the past half-decade.

Risk Factors

Investors should not forget about beta, an important way to measure a mutual fund’s risk compared to the market as a whole. MPACX has a 5-year beta of 0.77, which means it is likely to be less volatile than the market average. Because alpha represents a portfolio’s performance on a risk-adjusted basis relative to a benchmark, which is the S&P 500 in this case, one should pay attention to this metric as well. The fund has produced a negative alpha over the past 5 years of -7.4, which shows that managers in this portfolio find it difficult to pick 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, MPACX is a no load fund. It has an expense ratio of 1.07% compared to the category average of 1.29%. MPACX is actually cheaper than its peers when you consider factors like cost.

Investors need to be aware that with this product, the minimum initial investment is $2,500; each subsequent investment needs to be at least $100.

Bottom Line

Overall, Matthews Asia Growth Fund Investor ( MPACX ) has a low Zacks Mutual Fund rank, and in conjunction with its comparatively weak performance, average downside risk, and lower fees, this fund looks like a somewhat weak choice for investors right now.

Your research on the Mutual Fund Equity Report segment doesn’t have to stop here. You can check out all the great mutual fund tools we have to offer by going to www.zacks.com/funds/mutual-funds to see the additional features we offer as well for additional information. For analysis of the rest of your portfolio, make sure to visit Zacks.com for our full suite of tools which will help you investigate all of your stocks and funds in one place.

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