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Is Lord Abbett Alpha Strategy A (ALFAX) a Strong Mutual Fund Pick Right Now?
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Having trouble finding a Mutual Fund Equity Report fund? Lord Abbett Alpha Strategy A (ALFAX - Free Report) is a possible starting point. ALFAX has a Zacks Mutual Fund Rank of 3 (Hold), which is based on nine forecasting factors like size, cost, and past performance.
History of Fund/Manager
ALFAX is a part of the Lord Abbett family of funds, a company based out of Jersey City, NJ. Since Lord Abbett Alpha Strategy A made its debut in March of 1998, ALFAX has garnered more than $445.51 million 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. ALFAX has a 5-year annualized total return of 8.51% and is in the bottom 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 6.96%, which places it in the bottom 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, ALFAX's standard deviation comes in at 23.69%, compared to the category average of 15.67%. Over the past 5 years, the standard deviation of the fund is 20.82% compared to the category average of 13.93%. 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. ALFAX has a 5-year beta of 1.14, which means it 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. ALFAX has generated a negative alpha over the past five years of -5.44, demonstrating that managers in this portfolio find it difficult to pick securities that generate better-than-benchmark returns.
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, ALFAX is a load fund. It has an expense ratio of 0.41% compared to the category average of 1.08%. So, ALFAX is actually cheaper than its peers from a cost perspective.
This fund requires a minimum initial investment of $1,500, while there is no minimum for each subsequent investment.
Bottom Line
Overall, Lord Abbett Alpha Strategy A ( ALFAX ) has a neutral Zacks Mutual Fund rank, and in conjunction with its comparatively weak performance, worse downside risk, and lower fees, Lord Abbett Alpha Strategy A ( ALFAX ) looks like a somewhat average choice for investors right now.
For additional information on this product, or to compare it to other mutual funds in the Mutual Fund Equity Report, 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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Is Lord Abbett Alpha Strategy A (ALFAX) a Strong Mutual Fund Pick Right Now?
Having trouble finding a Mutual Fund Equity Report fund? Lord Abbett Alpha Strategy A (ALFAX - Free Report) is a possible starting point. ALFAX has a Zacks Mutual Fund Rank of 3 (Hold), which is based on nine forecasting factors like size, cost, and past performance.
History of Fund/Manager
ALFAX is a part of the Lord Abbett family of funds, a company based out of Jersey City, NJ. Since Lord Abbett Alpha Strategy A made its debut in March of 1998, ALFAX has garnered more than $445.51 million 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. ALFAX has a 5-year annualized total return of 8.51% and is in the bottom 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 6.96%, which places it in the bottom 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, ALFAX's standard deviation comes in at 23.69%, compared to the category average of 15.67%. Over the past 5 years, the standard deviation of the fund is 20.82% compared to the category average of 13.93%. 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. ALFAX has a 5-year beta of 1.14, which means it 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. ALFAX has generated a negative alpha over the past five years of -5.44, demonstrating that managers in this portfolio find it difficult to pick securities that generate better-than-benchmark returns.
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, ALFAX is a load fund. It has an expense ratio of 0.41% compared to the category average of 1.08%. So, ALFAX is actually cheaper than its peers from a cost perspective.
This fund requires a minimum initial investment of $1,500, while there is no minimum for each subsequent investment.
Bottom Line
Overall, Lord Abbett Alpha Strategy A ( ALFAX ) has a neutral Zacks Mutual Fund rank, and in conjunction with its comparatively weak performance, worse downside risk, and lower fees, Lord Abbett Alpha Strategy A ( ALFAX ) looks like a somewhat average choice for investors right now.
For additional information on this product, or to compare it to other mutual funds in the Mutual Fund Equity Report, 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.