Looking for an Index fund? You may want to consider iShares S&P 500 Index K (WFSPX) as a possible option. The fund does not have a Zacks Mutual Fund Rank, though we have been able to explore other metrics like performance, volatility, and cost.
History of Fund/Manager
WFSPX is a part of the BlackRock family of funds, a company based out of New York, NY. The iShares S&P 500 Index K made its debut in July of 1993 and WFSPX has managed to accumulate roughly $11.27 billion in assets, as of the most recently available information. The fund is currently managed by a team of investment professionals.
Of course, investors look for strong performance in funds. WFSPX has a 5-year annualized total return of 9.57% and is in the top third among its category peers. But if you are looking for a shorter time frame, it is also worth looking at its 3-year annualized total return of 11.7%, which places it in the top 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. Compared to the category average of 8.62%, the standard deviation of WFSPX over the past three years is 11.71%. Over the past 5 years, the standard deviation of the fund is 11.73% compared to the category average of 9.17%. This makes the fund more volatile than its peers over the past half-decade.
Investors cannot discount the risks to this segment though, as it is always important to remember the downside for any potential investment. In WFSPX's case, the fund lost 50.96% in the most recent bear market and underperformed its peer group by 5.23%. This might suggest that the fund is a worse choice than its peers during a bear market.
Investors should note that the fund has a 5-year beta of 1, so it is likely going to be as volatile as the market at large. 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. Over the past 5 years, the fund has a negative alpha of -0.07. This means that managers in this portfolio find it difficult to pick 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 primarily on equities that are traded in the United States.
Currently, this mutual fund is holding 77.73% stock in stocks, which have an average market capitalization of $197.78 billion. The fund has the heaviest exposure to the following market sectors:
Turnover is 12%, 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, WFSPX is a no load fund. It has an expense ratio of 0.04% compared to the category average of 0.76%. Looking at the fund from a cost perspective, WFSPX is actually cheaper than its peers.
Investors should also note that the minimum initial investment for the product is $5 million and that each subsequent investment has no minimum amount.
Your research on the Index 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. 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.
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