We use cookies to understand how you use our site and to improve your experience. This includes personalizing content and advertising. To learn more, click here. By continuing to use our site, you accept our use of cookies, revised Privacy Policy and Terms of Service.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
Is Hodges Small Cap Fund Institutional Class (HDSIX) a Strong Mutual Fund Pick Right Now?
Read MoreHide Full Article
If investors are looking at the Mutual Fund Equity Report fund category, make sure to pass over Hodges Small Cap Fund Institutional Class (HDSIX - Free Report) . HDSIX bears a Zacks Mutual Fund Rank of 4 (Sell), which is based on nine forecasting factors like size, cost, and past performance.
History of Fund/Manager
Hodges Capital is based in Dallas, TX, and is the manager of HDSIX. Hodges Small Cap Fund Institutional Class made its debut in December of 2008, and since then, HDSIX has accumulated about $42.70 million in assets, per the most up-to-date date available. The fund's current manager is a team of investment professionals.
Performance
Investors naturally seek funds with strong performance. This fund in particular has delivered a 5-year annualized total return of 9.44%, 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 16.48%, 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, HDSIX's standard deviation comes in at 33.88%, compared to the category average of 21.51%. Looking at the past 5 years, the fund's standard deviation is 29.88% compared to the category average of 19%. 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. HDSIX has a 5-year beta of 1.43, 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. HDSIX's 5-year performance has produced a negative alpha of -3.12, which means managers in this portfolio find it difficult to pick 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 mostly on equities that are traded in the United States.
Right now, 75.26% of this mutual fund's holdings are stocks, with an average market capitalization of $4.21 billion. The fund has the heaviest exposure to the following market sectors:
Industrial Cyclical
Retail Trade
Technology
Energy
Turnover is 67%, which means, on average, the fund makes more traders than comparable funds in a given year.
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, HDSIX is a no load fund. It has an expense ratio of 1.11% compared to the category average of 1.08%. From a cost perspective, HDSIX is actually more expensive than its peers.
While the minimum initial investment for the product is $1 million, investors should also note that each subsequent investment needs to be at least $100.
Bottom Line
Overall, Hodges Small Cap Fund Institutional Class ( HDSIX ) has a low Zacks Mutual Fund rank, and in conjunction with its comparatively strong performance, worse downside risk, and higher fees, Hodges Small Cap Fund Institutional Class ( HDSIX ) looks like a poor potential choice for investors right now.
Your research on the Mutual Fund Equity Report segment doesn't have to stop here. You can check out all the great mutual fund tools we have to offer by going to www.zacks.com/funds/mutual-funds to see the additional features we offer as well for additional information. And don't forget, Zacks has all of your needs covered on the equity side too! Make sure to check out Zacks.com for more information on our screening capabilities, Rank, and all our articles as well.
See More Zacks Research for These Tickers
Normally $25 each - click below to receive one report FREE:
Image: Bigstock
Is Hodges Small Cap Fund Institutional Class (HDSIX) a Strong Mutual Fund Pick Right Now?
If investors are looking at the Mutual Fund Equity Report fund category, make sure to pass over Hodges Small Cap Fund Institutional Class (HDSIX - Free Report) . HDSIX bears a Zacks Mutual Fund Rank of 4 (Sell), which is based on nine forecasting factors like size, cost, and past performance.
History of Fund/Manager
Hodges Capital is based in Dallas, TX, and is the manager of HDSIX. Hodges Small Cap Fund Institutional Class made its debut in December of 2008, and since then, HDSIX has accumulated about $42.70 million in assets, per the most up-to-date date available. The fund's current manager is a team of investment professionals.
Performance
Investors naturally seek funds with strong performance. This fund in particular has delivered a 5-year annualized total return of 9.44%, 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 16.48%, 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, HDSIX's standard deviation comes in at 33.88%, compared to the category average of 21.51%. Looking at the past 5 years, the fund's standard deviation is 29.88% compared to the category average of 19%. 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. HDSIX has a 5-year beta of 1.43, 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. HDSIX's 5-year performance has produced a negative alpha of -3.12, which means managers in this portfolio find it difficult to pick 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 mostly on equities that are traded in the United States.
Right now, 75.26% of this mutual fund's holdings are stocks, with an average market capitalization of $4.21 billion. The fund has the heaviest exposure to the following market sectors:
- Industrial Cyclical
- Retail Trade
- Technology
- Energy
Turnover is 67%, which means, on average, the fund makes more traders than comparable funds in a given year.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, HDSIX is a no load fund. It has an expense ratio of 1.11% compared to the category average of 1.08%. From a cost perspective, HDSIX is actually more expensive than its peers.
While the minimum initial investment for the product is $1 million, investors should also note that each subsequent investment needs to be at least $100.
Bottom Line
Overall, Hodges Small Cap Fund Institutional Class ( HDSIX ) has a low Zacks Mutual Fund rank, and in conjunction with its comparatively strong performance, worse downside risk, and higher fees, Hodges Small Cap Fund Institutional Class ( HDSIX ) looks like a poor potential choice for investors right now.
Your research on the Mutual Fund Equity Report segment doesn't have to stop here. You can check out all the great mutual fund tools we have to offer by going to www.zacks.com/funds/mutual-funds to see the additional features we offer as well for additional information. And don't forget, Zacks has all of your needs covered on the equity side too! Make sure to check out Zacks.com for more information on our screening capabilities, Rank, and all our articles as well.