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Is American Century Global Gold Investor (BGEIX) a Strong Mutual Fund Pick Right Now?
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Any investors hoping to find a Sector - Precious Metal fund could think about starting with American Century Global Gold Investor (BGEIX - Free Report) . BGEIX holds a Zacks Mutual Fund Rank of 2 (Buy), which is based on various forecasting factors like size, cost, and past performance.
Objective
The world of Sector - Precious Metal funds is an area filled with options, such as BGEIX. Usually, Sector - Precious Metal mutual funds invest in stocks with a focus on the mining and production of precious metals like gold, silver, platinum, and palladium. Here, stocks often trade as leveraged bets of the underlying commodity, meaning they're tied to the metal's prices and can be volatile.
History of Fund/Manager
American Century is based in Kansas City, MO, and is the manager of BGEIX. The American Century Global Gold Investor made its debut in August of 1988 and BGEIX has managed to accumulate roughly $529.51 million in assets, as of the most recently available information. The fund's current manager is a team of investment professionals.
Performance
Obviously, what investors are looking for in these funds is strong performance relative to their peers. This fund in particular has delivered a 5-year annualized total return of 6.83%, and it sits in the bottom 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 -0.89%, 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. Over the past three years, BGEIX's standard deviation comes in at 33.92%, compared to the category average of 17.38%. Looking at the past 5 years, the fund's standard deviation is 35.64% compared to the category average of 19.11%. This makes the fund more volatile than its peers over the past half-decade.
Risk Factors
With a 5-year beta of 0.91, the fund is likely to be less 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. With a negative alpha of -2.02, managers in this portfolio find it difficult to pick securities that generate better-than-benchmark returns.
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, BGEIX is a no load fund. It has an expense ratio of 0.66% compared to the category average of 1.07%. Looking at the fund from a cost perspective, BGEIX is actually cheaper than its peers.
Investors need to be aware that with this product, the minimum initial investment is $2,500; each subsequent investment needs to be at least $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, worse downside risk, and lower fees, American Century Global Gold Investor ( BGEIX ) has a high Zacks Mutual Fund rank, and therefore looks a great potential choice for investors right now.
For additional information on the Sector - Precious Metal 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 BGEIX too for additional information. If you want to check out our stock reports as well, make sure to go to Zacks.com to see all of the great tools we have to offer, including our time-tested Zacks Rank.
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Is American Century Global Gold Investor (BGEIX) a Strong Mutual Fund Pick Right Now?
Any investors hoping to find a Sector - Precious Metal fund could think about starting with American Century Global Gold Investor (BGEIX - Free Report) . BGEIX holds a Zacks Mutual Fund Rank of 2 (Buy), which is based on various forecasting factors like size, cost, and past performance.
Objective
The world of Sector - Precious Metal funds is an area filled with options, such as BGEIX. Usually, Sector - Precious Metal mutual funds invest in stocks with a focus on the mining and production of precious metals like gold, silver, platinum, and palladium. Here, stocks often trade as leveraged bets of the underlying commodity, meaning they're tied to the metal's prices and can be volatile.
History of Fund/Manager
American Century is based in Kansas City, MO, and is the manager of BGEIX. The American Century Global Gold Investor made its debut in August of 1988 and BGEIX has managed to accumulate roughly $529.51 million in assets, as of the most recently available information. The fund's current manager is a team of investment professionals.
Performance
Obviously, what investors are looking for in these funds is strong performance relative to their peers. This fund in particular has delivered a 5-year annualized total return of 6.83%, and it sits in the bottom 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 -0.89%, 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. Over the past three years, BGEIX's standard deviation comes in at 33.92%, compared to the category average of 17.38%. Looking at the past 5 years, the fund's standard deviation is 35.64% compared to the category average of 19.11%. This makes the fund more volatile than its peers over the past half-decade.
Risk Factors
With a 5-year beta of 0.91, the fund is likely to be less 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. With a negative alpha of -2.02, managers in this portfolio find it difficult to pick securities that generate better-than-benchmark returns.
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, BGEIX is a no load fund. It has an expense ratio of 0.66% compared to the category average of 1.07%. Looking at the fund from a cost perspective, BGEIX is actually cheaper than its peers.
Investors need to be aware that with this product, the minimum initial investment is $2,500; each subsequent investment needs to be at least $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, worse downside risk, and lower fees, American Century Global Gold Investor ( BGEIX ) has a high Zacks Mutual Fund rank, and therefore looks a great potential choice for investors right now.
For additional information on the Sector - Precious Metal 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 BGEIX too for additional information. If you want to check out our stock reports as well, make sure to go to Zacks.com to see all of the great tools we have to offer, including our time-tested Zacks Rank.