Yahoo Finance Is Diamond Hill Large Cap Fund A (DHLAX) a Strong Mutual Fund Pick Right Now?
If investors are looking at the Large Cap Blend fund category, Diamond Hill Large Cap Fund A (DHLAX) could be a potential option. DHLAX possesses a Zacks Mutual Fund Rank of 2 (Buy), which is based on various forecasting factors like size, cost, and past performance.
Objective
We note that DHLAX is a Large Cap Blend option, an area loaded with different options. More often than not, Large Cap Blend mutual funds invest in companies with a market cap of over $10 billion. Buying stakes in bigger companies offer these funds more stability, and are well-suited for investors with a " buy and hold " mindset. Additionally, blended funds mix large, more established firms into their portfolios, giving investors exposure to value and growth opportunities.
History of Fund/Manager
Diamond Hill is based in Columbus, OH, and is the manager of DHLAX. Diamond Hill Large Cap Fund A debuted in July of 2001. Since then, DHLAX has accumulated assets of about $330,000, according to the most recently available information. The fund is currently managed by Charles Bath who has been in charge of the fund since October of 2002.
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 11.44%, 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 7.05%, 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. Over the past three years, DHLAX's standard deviation comes in at 17.74%, compared to the category average of 15.03%. Looking at the past 5 years, the fund's standard deviation is 19.96% compared to the category average of 16.44%. This makes the fund more volatile than its peers over the past half-decade.
Risk Factors
The fund has a 5-year beta of 1.03, so investors should note that it is hypothetically as volatile as the market at large. Alpha is an additional metric to take into consideration, since it represents a portfolio's performance on a risk-adjusted basis relative to a benchmark, which in this case, is the S&P 500. The fund has produced a negative alpha over the past 5 years of -3.21, which shows that managers in this portfolio find it difficult to pick securities that generate better-than-benchmark returns.
Expenses
Costs are increasingly important for mutual fund investing, and particularly as competition heats up in this market. And all things being equal, a lower cost product will outperform its otherwise identical counterpart, so taking a closer look at these metrics is key for investors. In terms of fees, DHLAX is a no load fund. It has an expense ratio of 0.96% compared to the category average of 0.94%. Looking at the fund from a cost perspective, DHLAX is actually more expensive than its peers.
This fund requires a minimum initial investment of $2,500, while there is no minimum for each subsequent investment.
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, average downside risk, and higher fees, Diamond Hill Large Cap Fund A ( DHLAX ) has a high Zacks Mutual Fund rank, and therefore looks a good potential choice for investors right now.
Don't stop here for your research on Large Cap Blend 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 DHLAX to its peers 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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