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Is American Funds Growth Fund of America F (GFAFX) a Strong Mutual Fund Pick Right Now?
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If you've been stuck searching for Mutual Fund Equity Report funds, consider American Funds Growth Fund of America F (GFAFX - Free Report) as a possibility. GFAFX holds a Zacks Mutual Fund Rank of 2 (Buy), which is based on various forecasting factors like size, cost, and past performance.
History of Fund/Manager
American Funds is based in Los Angeles, CA, and is the manager of GFAFX. The American Funds Growth Fund of America F made its debut in November of 1973 and GFAFX has managed to accumulate roughly $5.06 billion in assets, as of the most recently available information. The fund's current manager is a team of investment professionals.
Performance
Investors naturally seek funds with strong performance. This fund has delivered a 5-year annualized total return of 8.65%, and it sits in the bottom third among its category peers. Investors who prefer analyzing shorter time frames should look at its 3-year annualized total return of 8.24%, which places it in the middle third during this time-frame.
It is important to note that the product's returns may not reflect all its expenses. Any fees not reflected would lower the returns. Total returns do not reflect the fund's [%] sale charge. If sales charges were included, total returns would have been lower.
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. Compared to the category average of 17.52%, the standard deviation of GFAFX over the past three years is 20.43%. The standard deviation of the fund over the past 5 years is 20.21% compared to the category average of 15.43%. This makes the fund more volatile than its peers over the past half-decade.
Risk Factors
With a 5-year beta of 1.04, the fund 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. Over the past 5 years, the fund has a negative alpha of -2.22. This means that managers in this portfolio find it difficult to pick securities that generate better-than-benchmark returns.
Holdings
Exploring 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.
Right now, 87.8% of this mutual fund's holdings are stocks, which have an average market capitalization of $242.63 billion. The fund has the heaviest exposure to the following market sectors:
Technology
Industrial Cyclical
Finance
Retail Trade
With turnover at about 34%, this fund is making fewer trades than comparable funds.
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, GFAFX is a no load fund. It has an expense ratio of 0.66% compared to the category average of 0.99%. So, GFAFX is actually cheaper than its peers from a cost perspective.
Investors should also note that the minimum initial investment for the product is $250 and that each subsequent investment needs to be at $50
Fees charged by investment advisors have not been taken into considiration. Returns would be less if those were included.
Bottom Line
Overall, even with its comparatively weak performance, average downside risk, and lower fees, American Funds Growth Fund of America F ( GFAFX ) has a high Zacks Mutual Fund rank, and therefore looks a great potential 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 GFAFX too 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 American Funds Growth Fund of America F (GFAFX) a Strong Mutual Fund Pick Right Now?
If you've been stuck searching for Mutual Fund Equity Report funds, consider American Funds Growth Fund of America F (GFAFX - Free Report) as a possibility. GFAFX holds a Zacks Mutual Fund Rank of 2 (Buy), which is based on various forecasting factors like size, cost, and past performance.
History of Fund/Manager
American Funds is based in Los Angeles, CA, and is the manager of GFAFX. The American Funds Growth Fund of America F made its debut in November of 1973 and GFAFX has managed to accumulate roughly $5.06 billion in assets, as of the most recently available information. The fund's current manager is a team of investment professionals.
Performance
Investors naturally seek funds with strong performance. This fund has delivered a 5-year annualized total return of 8.65%, and it sits in the bottom third among its category peers. Investors who prefer analyzing shorter time frames should look at its 3-year annualized total return of 8.24%, which places it in the middle third during this time-frame.
It is important to note that the product's returns may not reflect all its expenses. Any fees not reflected would lower the returns. Total returns do not reflect the fund's [%] sale charge. If sales charges were included, total returns would have been lower.
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. Compared to the category average of 17.52%, the standard deviation of GFAFX over the past three years is 20.43%. The standard deviation of the fund over the past 5 years is 20.21% compared to the category average of 15.43%. This makes the fund more volatile than its peers over the past half-decade.
Risk Factors
With a 5-year beta of 1.04, the fund 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. Over the past 5 years, the fund has a negative alpha of -2.22. This means that managers in this portfolio find it difficult to pick securities that generate better-than-benchmark returns.
Holdings
Exploring 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.
Right now, 87.8% of this mutual fund's holdings are stocks, which have an average market capitalization of $242.63 billion. The fund has the heaviest exposure to the following market sectors:
- Technology
- Industrial Cyclical
- Finance
- Retail Trade
With turnover at about 34%, this fund is making fewer trades than comparable funds.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, GFAFX is a no load fund. It has an expense ratio of 0.66% compared to the category average of 0.99%. So, GFAFX is actually cheaper than its peers from a cost perspective.
Investors should also note that the minimum initial investment for the product is $250 and that each subsequent investment needs to be at $50
Fees charged by investment advisors have not been taken into considiration. Returns would be less if those were included.
Bottom Line
Overall, even with its comparatively weak performance, average downside risk, and lower fees, American Funds Growth Fund of America F ( GFAFX ) has a high Zacks Mutual Fund rank, and therefore looks a great potential 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 GFAFX too 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.