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Is Akre Focus Retail (AKREX) a Strong Mutual Fund Pick Right Now? (Revised)

Zacks Equity Research

Having trouble finding a Mid Cap Growth fund? Well, Akre Focus Retail AKREX would not be a good potential starting point right now. AKREX holds a Zacks Mutual Fund Rank of 4 (Sell), which is based on nine forecasting factors like size, cost, and past performance.

Objective

AKREX is classified in the Large Cap Growth segment by Zacks, an area full of possibilities. Companies are usually considered to be large-cap if their stock market valuation is more than $10 billion. Large Cap Growth mutual funds invest in many large U.S. firms that are projected to grow at a faster rate than their large-cap peers.

History of Fund/Manager

Akre is responsible for AKREX, and the company is based out of Middleburg, VA. Akre Focus Retail debuted in August of 2009. Since then, AKREX has accumulated assets of about $5.65 billion, according to the most recently available information. The fund is currently managed by Charles T. Akre who has been in charge of the fund since August of 2009.

Performance

Investors naturally seek funds with strong performance. This fund has delivered a 5-year annualized total return of 15.85%, and it sits in the top third among its category peers. Investors who prefer analyzing shorter time frames should look at its 3-year annualized total return of 22%, which places it in the top 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. AKREX's standard deviation over the past three years is 10.65% compared to the category average of 11.31%. Looking at the past 5 years, the fund's standard deviation is 11.42% compared to the category average of 11.25%. This makes the fund more volatile than its peers over the past half-decade.

Risk Factors

It's always important to be aware of the downsides to any future investment, so one should not discount the risks that come with this segment.

Even still, the fund has a 5-year beta of 0.86, so investors should note that it is hypothetically less 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. With a positive alpha of 6.62, managers in this portfolio are skilled in picking securities that generate better-than-benchmark returns.

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, AKREX is a no load fund. It has an expense ratio of 1.31% compared to the category average of 1.21%. So, AKREX is actually more expensive than its peers from a cost perspective.

While the minimum initial investment for the product is $2,000, investors should also note that each subsequent investment needs to be at least $250.

Bottom Line

Overall, Akre Focus Retail ( AKREX ) has a low Zacks Mutual Fund rank, and in conjunction with its comparatively strong performance, average downside risk, and higher fees, this fund looks like a poor potential choice for investors right now.

Want even more information about AKREX? Then go over to Zacks.com and check out our mutual fund comparison tool, and all of the other great features that we have to help you with your mutual fund analysis 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.

We are reissuing this article to correct a mistake. The original article, published September 25, 2019, should no longer be relied upon.


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