On the lookout for a Mutual Fund Equity Report fund? Starting with AB Discovery Growth A (CHCLX) is one possibility. CHCLX possesses 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
AllianceBernstein is responsible for CHCLX, and the company is based out of New York, NY. The AB Discovery Growth A made its debut in July of 1938 and CHCLX has managed to accumulate roughly $587.78 million in assets, as of the most recently available information. 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 6.85%, and is 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 5.95%, 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. CHCLX’s standard deviation over the past three years is 26.54% compared to the category average of 18.58%. Over the past 5 years, the standard deviation of the fund is 24.86% compared to the category average of 16.19%. This makes the fund more volatile than its peers over the past half-decade.
Risk Factors
The fund has a 5-year beta of 1.14, so investors should note that it is hypothetically more volatile than the market at large. 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. CHCLX’s 5-year performance has produced a negative alpha of -2.7, 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.
Currently, this mutual fund is holding 94.73% stock in stocks, and these companies have an average market capitalization of $8.55 billion. The fund has the heaviest exposure to the following market sectors:
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Technology
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Industrial Cyclical
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Health
With turnover at about 64%, this fund is making 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, CHCLX is a load fund. It has an expense ratio of 0.91% compared to the category average of 1.15%. From a cost perspective, CHCLX 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.
Bottom Line
Overall, AB Discovery Growth A ( CHCLX ) has a high Zacks Mutual Fund rank, and in conjunction with its comparatively weak performance, worse downside risk, and lower fees, AB Discovery Growth A ( CHCLX ) looks like a great potential choice for investors right now.
This could just be the start of your research on CHCLXin the Mutual Fund Equity Report category. Consider going to www.zacks.com/funds/mutual-funds for additional information about this fund, and all the others that we rank as well 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.
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