Back to top

Image: Bigstock

Is American Century International Opportunity A (AIVOX) a Strong Mutual Fund Pick Right Now?

Read MoreHide Full Article

Having trouble finding a Non US - Equity fund? Well, American Century International Opportunity A (AIVOX - Free Report) would not be a good potential starting point right now. AIVOX has a Zacks Mutual Fund Rank of 5 (Strong Sell), which is based on various forecasting factors like size, cost, and past performance.

Objective

AIVOX is classified in the Non US - Equity area by Zacks, and this segment is full of potential. Non US - Equity funds focus their investments on companies outside of the United States, which is an important distinction since global mutual funds tend to keep a sizable portion of their portfolio based in the United States. Most of these funds will allocate across emerging and developed markets, and can often extend across cap levels too.

History of Fund/Manager

AIVOX is a part of the American Century family of funds, a company based out of Kansas City, MO. American Century International Opportunity A made its debut in March of 2010, and since then, AIVOX has accumulated about $4.95 million in assets, per the most up-to-date date available. A team of investment professionals is the fund's current manager.

Performance

Obviously, what investors are looking for in these funds is strong performance relative to their peers. This fund carries a 5-year annualized total return of 4.59%, and it sits in the middle third among its category peers. If you're interested in shorter time frames, do not dismiss looking at the fund's 3 -year annualized total return of -8.48%, which places it in the bottom 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 1%, the standard deviation of AIVOX over the past three years is 19.43%. Looking at the past 5 years, the fund's standard deviation is 20.62% compared to the category average of 87%. This makes the fund less volatile than its peers over the past half-decade.

Risk Factors

The fund has a 5-year beta of 1.04, 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. AIVOX has generated a negative alpha over the past five years of -9.84, demonstrating that managers in this portfolio find it difficult to pick securities that generate better-than-benchmark returns.

Expenses

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, AIVOX is a load fund. It has an expense ratio of 1.81% compared to the category average of 20%. AIVOX is actually cheaper than its peers when you consider factors like cost.

Investors should also note that the minimum initial investment for the product is $2,500 and that each subsequent investment needs to be at $50

Fees charged by investment advisors have not been taken into considiration. Returns would be less if those were included.

Bottom Line

Overall, even with its comparatively similar performance, better downside risk, and lower fees, American Century International Opportunity A ( AIVOX ) has a low Zacks Mutual Fund rank, and therefore looks a somewhat weak choice for investors right now.

For additional information on this product, or to compare it to other mutual funds in the Non US - Equity, make sure to go to www.zacks.com/funds/mutual-funds 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.


See More Zacks Research for These Tickers


Normally $25 each - click below to receive one report FREE:


American Century Intl Opport A (AIVOX) - free report >>

Published in