If you're looking for a Small Cap Value fund category, then a potential option is American Century Small Cap Value Investor (ASVIX). ASVIX possesses a Zacks Mutual Fund Rank of 3 (Hold), which is based on nine forecasting factors like size, cost, and past performance.
ASVIX is one of many Small Cap Value funds to choose from. Small Cap Value mutual funds typically invest in companies with market caps under $2 billion. These funds represent value because they offer more bang for an owner's buck, often demonstrated by lower P/E Ratios, high dividend yields, and better-than-average price-to-sales ratios.
History of Fund/Manager
American Century is based in Kansas City, MO, and is the manager of ASVIX. American Century Small Cap Value Investor debuted in July of 1998. Since then, ASVIX has accumulated assets of about $562.70 million, according to the most recently available information. Jeff John is the fund's current manager and has held that role since May of 2012.
Investors naturally seek funds with strong performance. This fund has delivered a 5-year annualized total return of 4.47%, 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 0.38%, 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. ASVIX's standard deviation over the past three years is 18.84% compared to the category average of 11.22%. Over the past 5 years, the standard deviation of the fund is 17.69% compared to the category average of 11%. 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 the most recent bear market, ASVIX lost 45.66% and outperformed its peer group by 6%. This could mean that the fund is a better choice than comparable funds during a bear market.
Investors should not forget about beta, an important way to measure a mutual fund's risk compared to the market as a whole. ASVIX has a 5-year beta of 1.23, which means it is likely to be more 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. ASVIX has generated a negative alpha over the past five years of -5.47, demonstrating that managers in this portfolio find it difficult to pick securities that generate better-than-benchmark returns.
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, ASVIX is a no load fund. It has an expense ratio of 1.25% compared to the category average of 1.29%. ASVIX is actually cheaper than its peers when you consider factors like cost.
Investors should also note that the minimum initial investment for the product is $2,500 and that each subsequent investment needs to be at $50.
Overall, American Century Small Cap Value Investor ( ASVIX ) has a neutral Zacks Mutual Fund rank, and in conjunction with its comparatively strong performance, worse downside risk, and lower fees, this fund looks like a somewhat average choice for investors right now.
For additional information on this product, or to compare it to other mutual funds in the Small Cap Value, make sure to go to www.zacks.com/funds/mutual-funds 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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