Small Cap Growth fund seekers should not consider taking a look at Wasatch Micro Cap Value Fund (WAMVX) at this time. WAMVX holds a Zacks Mutual Fund Rank of 5 (Strong Sell), which is based on nine forecasting factors like size, cost, and past performance.
The world of Small Cap Growth funds is an area filled with options, such as WAMVX. These funds tend to create their portfolios around stocks that sport large growth opportunities and market capitalization of less than $2 billion. The companies in these portfolios are usually on the smaller side, and are in up-and-coming industries and markets.
History of Fund/Manager
Wasatch is based in Salt Lake City, UT, and is the manager of WAMVX. The Wasatch Micro Cap Value Fund made its debut in July of 2003 and WAMVX has managed to accumulate roughly $262.35 million in assets, as of the most recently available information. The fund's current manager, Brian A. Bythrow, has been in charge of the fund since July of 2003.
Investors naturally seek funds with strong performance. This fund has delivered a 5-year annualized total return of 11.16%, 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 16.56%, 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. The standard deviation of WAMVX over the past three years is 13.54% compared to the category average of 15.92%. The standard deviation of the fund over the past 5 years is 13.18% compared to the category average of 16.46%. This makes the fund less volatile than its peers over the past half-decade.
It's always important to be aware of the downsides to any future investment, so one should not discount the risks that come with this segment. In WAMVX's case, the fund lost 56.66% in the most recent bear market and underperformed comparable funds by 3.62%. This makes the fund a possibly worse choice than its peers during a sliding market environment.
Even still, the fund has a 5-year beta of 0.89, so investors should note that it is hypothetically less volatile than the market at large. Another factor to consider is alpha, as it reflects a portfolio's performance on a risk-adjusted basis relative to a benchmark-in this case, the S&P 500. WAMVX's 5-year performance has produced a positive alpha of 1.01, which means managers in this portfolio are skilled in picking 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, WAMVX is a no load fund. It has an expense ratio of 1.74% compared to the category average of 1.22%. WAMVX is actually more expensive than its peers when you consider factors like cost.
This fund requires a minimum initial investment of $2,000, and each subsequent investment should be at least $100.
Overall, Wasatch Micro Cap Value Fund ( WAMVX ) has a low Zacks Mutual Fund rank, similar performance, average downside risk, and higher fees compared to its peers.
For additional information on this product, or to compare it to other mutual funds in the Small Cap Growth, make sure to go to www.zacks.com/funds/mutual-funds 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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