There are plenty of choices in the Mutual Fund Equity Report category, but where should you start your research? Well, one fund that may not be worth investigating is Invesco Summit P (SMMIX). SMMIX carries a Zacks Mutual Fund Rank of 4 (Sell), which is based on nine forecasting factors like size, cost, and past performance.
History of Fund/Manager
Invesco is responsible for SMMIX, and the company is based out of Kansas City, MO. Invesco Summit P debuted in November of 1982. Since then, SMMIX has accumulated assets of about $2.45 billion, according to the most recently available information. The fund is currently managed by Erik Voss who has been in charge of the fund since June of 2012.
Of course, investors look for strong performance in funds. This fund carries a 5-year annualized total return of 13.96%, and is in the middle third among its category peers. But if you are looking for a shorter time frame, it is also worth looking at its 3-year annualized total return of 12.12%, which places it in the middle 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. Over the past three years, SMMIX’s standard deviation comes in at 21.33%, compared to the category average of 16.01%. Looking at the past 5 years, the fund’s standard deviation is 19.33% compared to the category average of 14.08%. This makes the fund more volatile than its peers over the past half-decade.
Investors should note that the fund has a 5-year beta of 1.09, so it is likely going to be more volatile than the market at large. Alpha is an additional metric to take into consideration, since it represents a portfolio’s performance on a risk-adjusted basis relative to a benchmark, which in this case, is the S&P 500. SMMIX has generated a negative alpha over the past five years of -0.38, demonstrating that managers in this portfolio find it difficult to pick securities that generate better-than-benchmark returns.
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 mostly on equities that are traded in the United States.
Right now, 97.11% of this mutual fund’s holdings are stocks, which have an average market capitalization of $470.33 billion. The fund has the heaviest exposure to the following market sectors:
With turnover at about 47%, this fund makes fewer trades than the average comparable fund.
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, SMMIX is a no load fund. It has an expense ratio of 0.84% compared to the category average of 0.99%. From a cost perspective, SMMIX is actually cheaper than its peers.
This fund requires a minimum initial investment of $0, while there is no minimum for each subsequent investment.
Overall, Invesco Summit P ( SMMIX ) has a low Zacks Mutual Fund rank, and in conjunction with its comparatively similar performance, worse downside risk, and lower fees, Invesco Summit P ( SMMIX ) 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 SMMIX too 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.
Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
Get Your Free (SMMIX): Fund Analysis Report
To read this article on Zacks.com click here.