Technology

Is American Funds New Perspective A (ANWPX) a Strong Mutual Fund Pick Right Now?

On the lookout for a Global - Equity fund? Starting with American Funds New Perspective A (ANWPX) is one possibility. ANWPX possesses a Zacks Mutual Fund Rank of 1 (Strong Buy), which is based on nine forecasting factors like size, cost, and past performance.

Objective

Zacks categorizes ANWPX as Global - Equity, which is a segment packed with options. Global - Equity mutual funds invest in large markets like the U.S., Europe, and Japan, and operate with very few geographical limitations. They also provide an investment technique that leverages the diverse nature of the global economy in the hopes of providing a stable return.

History of Fund/Manager

ANWPX is a part of the American Funds family of funds, a company based out of Los Angeles, CA. American Funds New Perspective A debuted in March of 1973. Since then, ANWPX has accumulated assets of about $41.91 billion, according to the most recently available information. The fund's current manager is a team of investment professionals.

Performance

Of course, investors look for strong performance in funds. This fund has delivered a 5-year annualized total return of 8.68%, and is in the top 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 12.08%, 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. Over the past three years, ANWPX's standard deviation comes in at 12.01%, compared to the category average of 9.74%. The fund's standard deviation over the past 5 years is 12.01% compared to the category average of 9.9%. This makes the fund more volatile than its peers over the past half-decade.

Risk Factors

One cannot ignore the volatility of this segment, however, as it is always important for investors to remember the downside to any potential investment. In the most recent bear market, ANWPX lost 49.08% and outperformed its peer group by 4%. These results could imply that the fund is a better choice than its peers during a sliding market environment.

Even still, the fund has a 5-year beta of 0.93, so investors should note that it is hypothetically less volatile than the market at large. Alpha is an additional metric to take into consideration, since it represents a portfolio's performance on a risk-adjusted basis relative to a benchmark, which in this case, is the S&P 500. ANWPX's 5-year performance has produced a negative alpha of -0.63, which means managers in this portfolio find it difficult to pick securities that generate better-than-benchmark returns.

Expenses

Costs are increasingly important for mutual fund investing, and particularly as competition heats up in this market. And all things being equal, a lower cost product will outperform its otherwise identical counterpart, so taking a closer look at these metrics is key for investors. In terms of fees, ANWPX is a load fund. It has an expense ratio of 0.75% compared to the category average of 1.19%. Looking at the fund from a cost perspective, ANWPX 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.

Bottom Line

Overall, American Funds New Perspective A ( ANWPX ) has a high Zacks Mutual Fund rank, and in conjunction with its comparatively strong performance, average downside risk, and lower fees, this fund looks like a good potential choice for investors right now.

Want even more information about ANWPX? Then go over to Zacks.com and check out our mutual fund comparison tool, and all of the other great features that we have to help you with your mutual fund analysis for additional information. If you are more of a stock investor, make sure to also check out our Zacks Rank, and our full suite of tools we have available for novice and professional investors alike.


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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.