On the lookout for a Large Cap Growth fund? Starting with MFS Growth Fund A (MFEGX Quick QuoteMFEGX - Free Report) is one possibility. MFEGX holds a Zacks Mutual Fund Rank of 2 (Buy), which is based on various forecasting factors like size, cost, and past performance.

Objective

We classify MFEGX in the Large Cap Growth category, an area rife with potential choices. Large Cap Growth funds invest in many large U.S. companies that are expected to grow much faster compared to other large-cap stocks. To be considered large-cap, companies must have a market cap over $10 billion.

History of Fund/Manager

MFS is responsible for MFEGX, and the company is based out of Boston, MA. The MFS Growth Fund A made its debut in December of 1986 and MFEGX has managed to accumulate roughly $10.09 billion in assets, as of the most recently available information. The fund is currently managed by Eric B. Fischman who has been in charge of the fund since April of 2002.

Performance

Of course, investors look for strong performance in funds. MFEGX has a 5-year annualized total return of 14.1%, and it sits in the bottom third among its category peers. Investors who prefer analyzing shorter time frames should look at its 3-year annualized total return of 22.95%, 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. Over the past three years, MFEGX's standard deviation comes in at 18.44%, compared to the category average of 14.53%. The fund's standard deviation over the past 5 years is 18.99% compared to the category average of 14.12%. This makes the fund more volatile than its peers over the past half-decade.

Risk Factors

Investors should note that the fund has a 5-year beta of 1.1, so it is likely going to be 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. With a negative alpha of -3.02, 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, MFEGX is a load fund. It has an expense ratio of 0.82% compared to the category average of 0.95%. From a cost perspective, MFEGX is actually cheaper than its peers.

This fund requires a minimum initial investment of $1,000, and each subsequent investment should be at least $50.

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

Bottom Line

Overall, even with its comparatively weak performance, average downside risk, and lower fees, MFS Growth Fund A ( MFEGX ) has a high Zacks Mutual Fund rank, and therefore looks a great potential choice for investors right now.

For additional information on this product, or to compare it to other mutual funds in the Large Cap Growth, make sure to go to www.zacks.com/funds/mutual-funds for additional information. And don't forget, Zacks has all of your needs covered on the equity side too! Make sure to check out Zacks.com for more information on our screening capabilities, Rank, and all our articles as well.