On the lookout for a Large Cap Blend fund? Starting with American Funds Fundamentl Investors A (ANCFX) is one possibility. ANCFX holds a Zacks Mutual Fund Rank of 2 (Buy), which is based on various forecasting factors like size, cost, and past performance.
ANCFX is part of the Large Cap Blend section, an area that boasts an array of many possible options. Large Cap Blend mutual funds most often invest in firms with a market capitalization of $10 billion or more. By investing in bigger companies, these funds offer more stability, and are often well-suited for investors with a ” buy and hold ” mindset. Blended funds mix large, established companies into their holdings, which gives investors exposure to both value and growth at the same time.
American Funds is responsible for ANCFX, and the company is based out of Los Angeles, CA. Since American Funds Fundamentl Investors A made its debut in July of 1978, ANCFX has garnered more than $72.97 billion in assets. A team of investment professionals is the fund’s current manager.
Obviously, what investors are looking for in these funds is strong performance relative to their peers. This fund in particular has delivered a 5-year annualized total return of 14.49%, and it sits in the middle third among its category peers. Investors who prefer analyzing shorter time frames should look at its 3-year annualized total return of 11.04%, which places it in the middle third during this time-frame.
It is important to note that the product’s returns may not reflect all its expenses. Any fees not reflected would lower the returns. Total returns do not reflect the fund’s [%] sale charge. If sales charges were included, total returns would have been lower.
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. ANCFX’s standard deviation over the past three years is 17.14% compared to the category average of 14.54%. The standard deviation of the fund over the past 5 years is 17.79% compared to the category average of 15.28%. 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 0.97, so it is likely going to be as volatile as 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. ANCFX has generated a negative alpha over the past five years of -0.9, demonstrating that managers in this portfolio find it difficult to pick securities that generate better-than-benchmark returns.
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, ANCFX is a load fund. It has an expense ratio of 0.59% compared to the category average of 0.94%. Looking at the fund from a cost perspective, ANCFX is actually cheaper than its peers.
Investors need to be aware that with this product, the minimum initial investment is $250; each subsequent investment needs to be at least $50.
Fees charged by investment advisors have not been taken into considiration. Returns would be less if those were included.
Overall, American Funds Fundamentl Investors A ( ANCFX ) has a high Zacks Mutual Fund rank, and in conjunction with its comparatively similar performance, average downside risk, and lower fees, this fund looks like a great potential choice for investors right now.
Your research on the Large Cap Blend 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. 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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