Any investors hoping to find a Mutual Fund Equity Report fund might consider looking past American Funds New Economy 529A (CNGAX Quick QuoteCNGAX - Free Report) . CNGAX holds a Zacks Mutual Fund Rank of 5 (Strong Sell), which is based on various forecasting factors like size, cost, and past performance.

History of Fund/Manager

CNGAX is a part of the American Funds family of funds, a company based out of Los Angeles, CA. Since American Funds New Economy 529A made its debut in December of 1983, CNGAX has garnered more than $792.33 million in assets. The fund's current manager is a team of investment professionals.

Performance

Of course, investors look for strong performance in funds. CNGAX has a 5-year annualized total return of 5.84% and is in the middle third among its category peers. Investors who prefer analyzing shorter time frames should look at its 3-year annualized total return of 7.52%, 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. CNGAX's standard deviation over the past three years is 18.81% compared to the category average of 15.53%. Over the past 5 years, the standard deviation of the fund is 18.89% compared to the category average of 15.35%. This makes the fund more volatile than its peers over the past half-decade.

Risk Factors

With a 5-year beta of 0.95, the fund is likely to be less volatile than the market average. Another factor to consider is alpha, as it reflects a portfolio's performance on a risk-adjusted basis relative to a benchmark-in this case, the S&P 500. CNGAX's 5-year performance has produced a negative alpha of -4.42, 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 largely on equities that are traded in the United States.

Currently, this mutual fund is holding 87.55% stock in stocks, with an average market capitalization of $208.56 billion. This fund's turnover is about 35%, so the fund managers are making fewer trades than comparable funds.

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, CNGAX is a load fund. It has an expense ratio of 0.78% compared to the category average of 1.11%. From a cost perspective, CNGAX is actually cheaper than its peers.

Investors need to be aware that with this product, the minimum initial investment is $250; each subsequent investment needs to be at least $50.

Bottom Line

Overall, American Funds New Economy 529A ( CNGAX ) has a low Zacks Mutual Fund rank, and in conjunction with its comparatively similar performance, average downside risk, and lower fees, American Funds New Economy 529A ( CNGAX ) 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 CNGAX too for additional information. Want to learn even more? We have a full suite of tools on stocks that you can use to find the best choices for your portfolio too, no matter what kind of investor you are.