Yahoo Finance Is Matthews Japan Fund (MJFOX) a Strong Mutual Fund Pick Right Now?
If investors are looking at the Japan - Equity fund category, make sure to pass over Matthews Japan Fund (MJFOX). MJFOX carries a Zacks Mutual Fund Rank of 5 (Strong Sell), which is based on various forecasting factors like size, cost, and past performance.
Objective
The world of Japan - Equity funds is an area filled with choices, and one such option is MJFOX. Japan - Equity mutual funds invest primarily in companies based in Japan, one of the world's richest and most diversified economies. The country remains somewhat exposed to global economic trends with its export focus, while its lack of natural resources also can impact the nation.
History of Fund/Manager
MJFOX finds itself in the Matthews Asia family, based out of San Francisco, CA. The Matthews Japan Fund made its debut in December of 1998 and MJFOX has managed to accumulate roughly $255.04 million in assets, as of the most recently available information. The fund's current manager, Shuntaro Takeuchi, has been in charge of the fund since January of 2019.
Performance
Obviously, what investors are looking for in these funds is strong performance relative to their peers. This fund has delivered a 5-year annualized total return of 4.94%, and is 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 -1.3%, 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. Compared to the category average of 15.03%, the standard deviation of MJFOX over the past three years is 18.58%. Over the past 5 years, the standard deviation of the fund is 17.5% compared to the category average of 15.82%. This makes the fund more volatile than its peers over the past half-decade.
Risk Factors
Investors should not forget about beta, an important way to measure a mutual fund's risk compared to the market as a whole. MJFOX has a 5-year beta of 0.74, which means it is likely to be less volatile than the market average. 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. The fund has produced a negative alpha over the past 5 years of -4.57, which shows that managers in this portfolio find it difficult to pick 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, MJFOX is a no load fund. It has an expense ratio of 1.09% compared to the category average of 1.01%. Looking at the fund from a cost perspective, MJFOX is actually more expensive 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 $100.
Fees charged by investment advisors have not been taken into considiration. Returns would be less if those were included.
Bottom Line
Overall, Matthews Japan Fund ( MJFOX ) 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.
Your research on the Japan - Equity segment doesn't have to stop here. You can check out all the great mutual fund tools we have to offer by going to www.zacks.com/funds/mutual-funds to see the additional features we offer as well 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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