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There are plenty of choices in the Large Cap Growth category, but where should you start your research? Well, one fund that might be worth investigating is Loomis Sayles Growth Fund A (LGRRX). LGRRX has a Zacks Mutual Fund Rank of 1 (Strong Buy), which is based on nine forecasting factors like size, cost, and past performance.
Objective
LGRRX is part of the Large Cap Growth section, and this segment boasts an array of other possible options. Large Cap Growth mutual funds purchase stakes in numerous large U.S. companies that are expected to develop and grow at a faster rate than other large-cap stocks. Companies are usually considered to be large-cap if their market capitalization is over $10 billion.
History of Fund/Manager
Natixis Funds is based in Kansas City, MO, and is the manager of LGRRX. The Loomis Sayles Growth Fund A made its debut in May of 1991 and LGRRX has managed to accumulate roughly $1.26 billion in assets, as of the most recently available information. Aziz V. Hamzaogullari is the fund's current manager and has held that role since May of 2010.
Performance
Of course, investors look for strong performance in funds. LGRRX has a 5-year annualized total return of 13.4% and is in the top 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 14.29%, 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. The standard deviation of LGRRX over the past three years is 13.98% compared to the category average of 10.32%. The fund's standard deviation over the past 5 years is 13.81% compared to the category average of 10.4%. This makes the fund more volatile than its peers over the past half-decade.
Risk Factors
Investors should always remember the downsides to a potential investment, and this segment carries some risks one should be aware of. In LGRRX's case, the fund lost 54.96% in the most recent bear market and underperformed comparable funds by 6%. These results could imply that the fund is a worse choice than its peers during a sliding market environment.
Investors should note that the fund has a 5-year beta of 1.09, so it is likely going to be 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. With a positive alpha of 2.42, managers in this portfolio are skilled in picking securities that generate better-than-benchmark returns.