Is AB Discovery Growth A (CHCLX) a Strong Mutual Fund Pick Right Now?
Mutual Fund Report for CHCLX
Mid Cap Growth fund seekers should consider taking a look at AB Discovery Growth A (CHCLX). CHCLX holds a Zacks Mutual Fund Rank of 1 (Strong Buy), which is based on nine forecasting factors like size, cost, and past performance.
CHCLX is part of the Mid Cap Growth section, a segment that boasts a wide array of possible selections. While Mid Cap Growth mutual funds choose companies with a stock market valuation between $2 billion and $10 billion, stocks in these funds are also expected to show broad considerable growth opportunities for investors compared to their peers. To be considered a growth stock, companies must consistently report impressive sales and/or earnings growth.
History of Fund/Manager
AllianceBernstein is based in New York, NY, and is the manager of CHCLX. The AB Discovery Growth A made its debut in July of 1938 and CHCLX has managed to accumulate roughly $1.06 billion in assets, as of the most recently available information. The fund is currently managed by a team of investment professionals.
Investors naturally seek funds with strong performance. This fund in particular has delivered a 5-year annualized total return of 23.32%, 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 19.2%, 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. Compared to the category average of 16.14%, the standard deviation of CHCLX over the past three years is 24.73%. Looking at the past 5 years, the fund's standard deviation is 20.23% compared to the category average of 13.25%. This makes the fund more volatile than its peers over the past half-decade.
The fund has a 5-year beta of 1.12, so investors should note that 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. CHCLX's 5-year performance has produced a positive alpha of 3.35, which means managers in this portfolio are skilled in picking securities that generate better-than-benchmark returns.
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, CHCLX is a load fund. It has an expense ratio of 0.91% compared to the category average of 1.17%. Looking at the fund from a cost perspective, CHCLX is actually cheaper than its peers.
While the minimum initial investment for the product is $2,500, investors should also note that each subsequent investment needs to be at least $50.
Overall, AB Discovery Growth A ( CHCLX ) has a high Zacks Mutual Fund rank, and in conjunction with its comparatively strong performance, worse downside risk, and lower fees, this fund looks like a good potential choice for investors right now.
Don't stop here for your research on Mid Cap Growth 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 CHCLX to its peers as well for additional information. For analysis of the rest of your portfolio, make sure to visit Zacks.com for our full suite of tools which will help you investigate all of your stocks and funds in one place.
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