On the lookout for a Mutual Fund Equity Report fund? Starting with American Century Ultra Investor (TWCUX) should not be a possibility at this time. TWCUX possesses a Zacks Mutual Fund Rank of 4 (Sell), which is based on various forecasting factors like size, cost, and past performance.
Load Error
History of Fund/Manager
TWCUX is a part of the American Century family of funds, a company based out of Kansas City, MO. The American Century Ultra Investor made its debut in November of 1981 and TWCUX has managed to accumulate roughly $15.64 billion in assets, as of the most recently available information. The fund is currently managed by a team of investment professionals.
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 13.88%, and it sits 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 12.27%, 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, TWCUX’s standard deviation comes in at 24.11%, compared to the category average of 18%. The fund’s standard deviation over the past 5 years is 23.2% compared to the category average of 15.85%. This makes the fund more volatile than its peers over the past half-decade.
Risk Factors
Investors should not forget about beta, an important way to measure a mutual fund’s risk compared to the market as a whole. TWCUX has a 5-year beta of 1.17, which means it is likely to be more volatile than the market average. 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. The fund has produced a positive alpha over the past 5 years of 1.7, which shows that managers in this portfolio are skilled in picking securities that generate better-than-benchmark returns.
Holdings
Examining the equity holdings of a mutual fund is also a valuable exercise. This can show us how the manager is applying their stated methodology, as well as if there are any inherent biases in their approach. For this particular fund, the focus is principally on equities that are traded in the United States.
The mutual fund currently has 87.91% of its holdings in stocks, with an average market capitalization of $296.40 billion. The fund has the heaviest exposure to the following market sectors:
- Technology
- Retail Trade
Turnover is 13%, which means this fund makes fewer trades than the average comparable fund.
Expenses
For investors, taking a closer look at cost-related metrics is key, since costs are increasingly important for mutual fund investing. Competition is heating up in this space, and a lower cost product will likely outperform its otherwise identical counterpart, all things being equal. In terms of fees, TWCUX is a no load fund. It has an expense ratio of 0.94% compared to the category average of 0.99%. Looking at the fund from a cost perspective, TWCUX is actually cheaper than its peers.
Investors need to be aware that with this product, the minimum initial investment is $2,500; each subsequent investment needs to be at least $50.
Bottom Line
Overall, American Century Ultra Investor ( TWCUX ) has a low Zacks Mutual Fund rank, and in conjunction with its comparatively strong performance, worse downside risk, and lower fees, this fund looks like a somewhat weak choice for investors right now.
For additional information on the Mutual Fund Equity Report area of the mutual fund world, make sure to check out www.zacks.com/funds/mutual-funds. There, you can see more about the ranking process, and dive even deeper into TWCUX too for additional information. If you want to check out our stock reports as well, make sure to go to Zacks.com to see all of the great tools we have to offer, including our time-tested Zacks Rank.