If investors are looking at the Mutual Fund Equity Report fund category, Scout Small Cap Fund (UMBHX Quick QuoteUMBHX - Free Report) could be a potential option. UMBHX possesses a Zacks Mutual Fund Rank of 2 (Buy), which is based on nine forecasting factors like size, cost, and past performance.

History of Fund/Manager

UMBHX finds itself in the Eagle Funds family, based out of St. Petersburg, FL. The Scout Small Cap Fund made its debut in December of 1986 and UMBHX has managed to accumulate roughly $254.45 million in assets, as of the most recently available information. The fund's current manager, James McBride, has been in charge of the fund since May of 2010.

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 7.88%, and it sits 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 3.96%, 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. Over the past three years, UMBHX's standard deviation comes in at 24.76%, compared to the category average of 18.25%. Over the past 5 years, the standard deviation of the fund is 23.13% compared to the category average of 16.39%. 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. UMBHX has a 5-year beta of 1.19, 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 negative alpha over the past 5 years of -3.89, 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 primarily on equities that are traded in the United States.

This fund is currently holding about 97.94% stock in stocks, which have an average market capitalization of $3.32 billion. The fund has the heaviest exposure to the following market sectors:

1. Technology
2. Services
3. Health

Expenses

Costs are increasingly important for mutual fund investing, and particularly as competition heats up in this market. And all things being equal, a lower cost product will outperform its otherwise identical counterpart, so taking a closer look at these metrics is key for investors. In terms of fees, UMBHX is a no load fund. It has an expense ratio of 0.90% compared to the category average of 1.19%. UMBHX is actually cheaper than its peers when you consider factors like cost.

This fund requires a minimum initial investment of $10,000, while there is no minimum for each subsequent investment.

Bottom Line

Overall, Scout Small Cap Fund ( UMBHX ) has a high Zacks Mutual Fund rank, and in conjunction with its comparatively similar performance, worse downside risk, and lower fees, this fund looks like a great potential 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.