Mutual Fund Equity Report fund seekers may want to consider taking a look at USAA Small Cap Stock Fund (USCAX Quick QuoteUSCAX - Free Report) . USCAX holds 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

Victory is responsible for USCAX, and the company is based out of Columbus, OH. USAA Small Cap Stock Fund debuted in August of 1999. Since then, USCAX has accumulated assets of about $569.52 million, according to the most recently available information. The fund is currently managed by a team of investment professionals.

Performance

Investors naturally seek funds with strong performance. This fund has delivered a 5-year annualized total return of 6.85%, and it sits in the top 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 6.13%, 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. USCAX's standard deviation over the past three years is 25.12% compared to the category average of 19.33%. The standard deviation of the fund over the past 5 years is 22.66% compared to the category average of 17.39%. This makes the fund more volatile than its peers over the past half-decade.

Risk Factors

Investors should note that the fund has a 5-year beta of 1.18, which means it is hypothetically 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. The fund has produced a negative alpha over the past 5 years of -4.81, which shows that managers in this portfolio find it difficult to pick securities that generate better-than-benchmark returns.

Holdings

Investigating 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 mostly on equities that are traded in the United States.

Currently, this mutual fund is holding 99.28% stock in stocks, with an average market capitalization of $3.80 billion. The fund has the heaviest exposure to the following market sectors:

1. Finance
2. Technology
3. Industrial Cyclical

Turnover is about 90%, so those in charge of the fund make more trades in a given year than the category average.

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, USCAX is a no load fund. It has an expense ratio of 1.08% compared to the category average of 1.08%. So, USCAX is actually on par with its peers from a cost perspective.

While the minimum initial investment for the product is $3,000, investors should also note that each subsequent investment needs to be at least $50.

Bottom Line

Overall, USAA Small Cap Stock Fund ( USCAX ) has a neutral Zacks Mutual Fund rank, and in conjunction with its comparatively strong performance, worse downside risk, and on par fees, this fund 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. Zacks provides a full suite of tools to help you analyze your portfolio - both funds and stocks - in the most efficient way possible.