Is Wasatch Core Growth Fund (WGROX) a Strong Mutual Fund Pick Right Now?

If you're looking for a Small Cap Growth fund category, then a potential option is Wasatch Core Growth Fund (WGROX). WGROX possesses a Zacks Mutual Fund Rank of 3 (Hold), which is based on various forecasting factors like size, cost, and past performance.

Objective

WGROX is part of the Small Cap Growth category, and this segment boasts an array of many other possible options. Small Cap Growth mutual funds usually focus their portfolios on stocks with large growth opportunities and a market cap of under $2 billion. These portfolios tend to feature small companies in up-and-coming industries and markets.

History of Fund/Manager

WGROX finds itself in the Wasatch family, based out of Salt Lake City, UT. Since Wasatch Core Growth Fund made its debut in November of 1986, WGROX has garnered more than $2.01 billion in assets. The fund's current manager is a team of investment professionals.

Performance

Obviously, what investors are looking for in these funds is strong performance relative to their peers. WGROX has a 5-year annualized total return of 12.98% and is in the top third among its category peers. Investors who prefer analyzing shorter time frames should look at its 3-year annualized total return of 3.39%, which places it in the top third during this time-frame.

It is important to note that the product's returns may not reflect all its expenses. Any fees not reflected would lower the returns. Total returns do not reflect the fund's [%] sale charge. If sales charges were included, total returns would have been lower.

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, WGROX's standard deviation comes in at 23.51%, compared to the category average of 18.06%. The standard deviation of the fund over the past 5 years is 24.23% compared to the category average of 19.49%. This makes the fund more volatile than its peers over the past half-decade.

Risk Factors

With a 5-year beta of 1.18, the fund 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. WGROX's 5-year performance has produced a negative alpha of -3.06, which means managers in this portfolio find it difficult to pick securities that generate better-than-benchmark returns.

Expenses

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, WGROX is a no load fund. It has an expense ratio of 1.17% compared to the category average of 1.07%. From a cost perspective, WGROX is actually more expensive than its peers.

This fund requires a minimum initial investment of $2,000, and each subsequent investment should be at least $100.

Fees charged by investment advisors have not been taken into considiration. Returns would be less if those were included.

Bottom Line

Overall, even with its comparatively strong performance, average downside risk, and higher fees, Wasatch Core Growth Fund ( WGROX ) has a neutral Zacks Mutual Fund rank, and therefore looks a somewhat average choice for investors right now.

Want even more information about WGROX? 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. Zacks provides a full suite of tools to help you analyze your portfolio - both funds and stocks - in the most efficient way possible.

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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.

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