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Is Oakmark International Investor (OAKIX) a Strong Mutual Fund Pick Right Now?

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Any investors hoping to find a Non US - Equity fund might consider looking past Oakmark International Investor OAKIX . OAKIX has a Zacks Mutual Fund Rank of 5 (Strong Sell), which is based on nine forecasting factors like size, cost, and past performance.

Objective

Zacks categorizes OAKIX as Non US - Equity, a segment stacked high with options. Non US - Equity mutual funds like to invest in companies outside of the United States, an important characteristic since global mutual funds are known to keep a good portion of their portfolio stateside. These kinds of funds can often extend across all cap levels, and will typically allocate their investments between emerging and developed markets.

History of Fund/Manager

Oakmark is based in Kansas City, MO, and is the manager of OAKIX. The Oakmark International Investor made its debut in September of 1992 and OAKIX has managed to accumulate roughly $26.57 billion in assets, as of the most recently available information. The fund is currently managed by David G. Herro who has been in charge of the fund since September of 1992.

Performance

Obviously, what investors are looking for in these funds is strong performance relative to their peers. This fund has delivered a 5-year annualized total return of 5.86%, and is in the middle 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 6.37%, which places it in the middle 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 9.75%, the standard deviation of OAKIX over the past three years is 16.21%. Over the past 5 years, the standard deviation of the fund is 14.06% compared to the category average of 9.49%. 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. OAKIX lost 54.93% in the most recent bear market and underperformed its peer group by 3.47%. This could mean that the fund is a worse choice than comparable funds during a bear market.

Investors should note that the fund has a 5-year beta of 1.1, so it is likely going to be more volatile than 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. OAKIX has generated a negative alpha over the past five years of -7.12, demonstrating that 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, OAKIX is a no load fund. It has an expense ratio of 0.95% compared to the category average of 1.28%. So, OAKIX is actually cheaper than its peers from a cost perspective.

While the minimum initial investment for the product is $1,000, investors should also note that each subsequent investment needs to be at least $100.

Bottom Line

Overall, Oakmark International Investor has a low Zacks Mutual Fund rank, and in conjunction with its comparatively similar performance, average downside risk, and lower fees, this fund looks like a somewhat weak choice for investors right now.

Don't stop here for your research on Non US - Equity funds. We also have plenty more on our site in order to help you find the best possible fund for your portfolio. Make sure to check out www.zacks.com/funds/mutual-funds for more information about the world of funds, and feel free to compare OAKIX to its peers 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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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.


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

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