If you’ve been stuck searching for Mutual Fund Equity Report funds, you might want to consider passing on by Schwab Select Large Cap Growth Fund (LGILX) as a possibility. LGILX has a Zacks Mutual Fund Rank of 4 (Sell), which is based on various forecasting factors like size, cost, and past performance.
History of Fund/Manager
Laudus is based in Boston, MA, and is the manager of LGILX. The Schwab Select Large Cap Growth Fund made its debut in July of 2009 and LGILX has managed to accumulate roughly $1.90 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. LGILX has a 5-year annualized total return of 6.9% and it sits in the bottom third among its category peers. Investors who prefer analyzing shorter time frames should look at its 3-year annualized total return of 1.06%, 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 LGILX over the past three years is 24.73% compared to the category average of 23.87%. Over the past 5 years, the standard deviation of the fund is 21.84% compared to the category average of 21.12%. This makes the fund more volatile than its peers over the past half-decade.
Investors should not forget about beta, an important way to measure a mutual fund’s risk compared to the market as a whole. LGILX has a 5-year beta of 1.09, which means it is likely to be more volatile than the market average. 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. LGILX has generated a negative alpha over the past five years of -2.5, demonstrating that managers in this portfolio find it difficult to pick securities that generate better-than-benchmark returns.
Investigating 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.
This fund is currently holding about 90.06% stock in stocks, which have an average market capitalization of $327.46 billion. The fund has the heaviest exposure to the following market sectors:
- Retail Trade
Turnover is 50%, which means, on average, the fund makes 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, LGILX is a no load fund. It has an expense ratio of 0.75% compared to the category average of 0.99%. Looking at the fund from a cost perspective, LGILX is actually cheaper than its peers.
This fund requires a minimum initial investment of $0, while there is no minimum for each subsequent investment.
Overall, Schwab Select Large Cap Growth Fund ( LGILX ) 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.
This could just be the start of your research on LGILXin the Mutual Fund Equity Report category. Consider going to www.zacks.com/funds/mutual-funds for additional information about this fund, and all the others that we rank as well for additional information. Want to learn even more? We have a full suite of tools on stocks that you can use to find the best choices for your portfolio too, no matter what kind of investor you are.