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Is Hodges Small Cap Fund Institutional Class (HDSIX) a Strong Mutual Fund Pick Right Now?
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Having trouble finding a Small Cap Blend fund? Well, Hodges Small Cap Fund Institutional Class (HDSIX - Free Report) would not be a good potential starting point right now. HDSIX has a Zacks Mutual Fund Rank of 5 (Strong Sell), which is based on various forecasting factors like size, cost, and past performance.
Objective
Zacks categorizes HDSIX as Small Cap Blend, which is an area packed with options. Usually targeting stocks with market caps of less than $2 billion, a Small Cap Blend mutual fund lets investors diversify their funds among other kinds of small-cap equities. This can help reduce risk found in companies that have a lower stock market valuation.
History of Fund/Manager
HDSIX finds itself in the Hodges Capital family, based out of Dallas, TX. Since Hodges Small Cap Fund Institutional Class made its debut in December of 2008, HDSIX has garnered more than $40.19 million in assets. The fund is currently managed by 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 13.28%, 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 3.05%, which places it in the top 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. The standard deviation of HDSIX over the past three years is 26.48% compared to the category average of 17.45%. Over the past 5 years, the standard deviation of the fund is 29.73% compared to the category average of 19.27%. This makes the fund more volatile than its peers over the past half-decade.
Risk Factors
Investors should note that the fund has a 5-year beta of 1.41, which means it is hypothetically more volatile than the market at large. 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 -5.16, which means 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 largely on equities that are traded in the United States.
As of the last filing date, the mutual fund has 81.82% of its assets in stocks, which have an average market capitalization of $5.14 billion. The fund has the heaviest exposure to the following market sectors:
Industrial Cyclical
Energy
Technology
Retail Trade
This fund's turnover is about 69%, so the fund managers are making more trades per year than the comparable average.
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, HDSIX is a no load fund. It has an expense ratio of 1.14% compared to the category average of 0.98%. HDSIX is actually more expensive than its peers when you consider factors like cost.
Investors should also note that the minimum initial investment for the product is $1 million and that each subsequent investment needs to be at $100
Fees charged by investment advisors have not been taken into considiration. Returns would be less if those were included.
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.
Don't stop here for your research on Small Cap Blend funds. We also have plenty more on our site in order to help you find the best possible fund for your portfolio. Make sure to check out www.zacks.com/funds/mutual-funds for more information about the world of funds, and feel free to compare HDSIX to its peers as well for additional information. Zacks provides a full suite of tools to help you analyze your portfolio - both funds and stocks - in the most efficient way possible.
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Is Hodges Small Cap Fund Institutional Class (HDSIX) a Strong Mutual Fund Pick Right Now?
Having trouble finding a Small Cap Blend fund? Well, Hodges Small Cap Fund Institutional Class (HDSIX - Free Report) would not be a good potential starting point right now. HDSIX has a Zacks Mutual Fund Rank of 5 (Strong Sell), which is based on various forecasting factors like size, cost, and past performance.
Objective
Zacks categorizes HDSIX as Small Cap Blend, which is an area packed with options. Usually targeting stocks with market caps of less than $2 billion, a Small Cap Blend mutual fund lets investors diversify their funds among other kinds of small-cap equities. This can help reduce risk found in companies that have a lower stock market valuation.
History of Fund/Manager
HDSIX finds itself in the Hodges Capital family, based out of Dallas, TX. Since Hodges Small Cap Fund Institutional Class made its debut in December of 2008, HDSIX has garnered more than $40.19 million in assets. The fund is currently managed by 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 13.28%, 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 3.05%, which places it in the top 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. The standard deviation of HDSIX over the past three years is 26.48% compared to the category average of 17.45%. Over the past 5 years, the standard deviation of the fund is 29.73% compared to the category average of 19.27%. This makes the fund more volatile than its peers over the past half-decade.
Risk Factors
Investors should note that the fund has a 5-year beta of 1.41, which means it is hypothetically more volatile than the market at large. 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 -5.16, which means 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 largely on equities that are traded in the United States.
As of the last filing date, the mutual fund has 81.82% of its assets in stocks, which have an average market capitalization of $5.14 billion. The fund has the heaviest exposure to the following market sectors:
- Industrial Cyclical
- Energy
- Technology
- Retail Trade
This fund's turnover is about 69%, so the fund managers are making more trades per year than the comparable average.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, HDSIX is a no load fund. It has an expense ratio of 1.14% compared to the category average of 0.98%. HDSIX is actually more expensive than its peers when you consider factors like cost.
Investors should also note that the minimum initial investment for the product is $1 million and that each subsequent investment needs to be at $100
Fees charged by investment advisors have not been taken into considiration. Returns would be less if those were included.
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.
Don't stop here for your research on Small Cap Blend funds. We also have plenty more on our site in order to help you find the best possible fund for your portfolio. Make sure to check out www.zacks.com/funds/mutual-funds for more information about the world of funds, and feel free to compare HDSIX to its peers as well for additional information. Zacks provides a full suite of tools to help you analyze your portfolio - both funds and stocks - in the most efficient way possible.