If you have been looking for Non US – Equity funds, it would not be wise to start your search with DWS Emerging Markets Equity Instl (SEKIX). SEKIX bears a Zacks Mutual Fund Rank of 4 (Sell), which is based on various forecasting factors like size, cost, and past performance.

Objective

Zacks categorizes SEKIX as Non US – Equity, a segment stacked high with options. Non US – Equity mutual funds like to invest in companies outside of the United States, an important characteristic since global mutual funds are known to keep a good portion of their portfolio stateside. These kinds of funds can often extend across all cap levels, and will typically allocate their investments between emerging and developed markets.

History of Fund/Manager

DWS is responsible for SEKIX, and the company is based out of New York, NY. DWS Emerging Markets Equity Instl made its debut in March of 2008, and since then, SEKIX has accumulated about $23.86 million in assets, per the most up-to-date date available. The fund is currently managed by Sebastian Kahlfeld who has been in charge of the fund since October of 2023.

Performance

Investors naturally seek funds with strong performance. SEKIX has a 5-year annualized total return of 6.03%, and is in the bottom third among its category peers. But if you are looking for a shorter time frame, it is also worth looking at its 3-year annualized total return of 22.96%, 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. The standard deviation of SEKIX over the past three years is 16.96% compared to the category average of 12.12%. Looking at the past 5 years, the fund’s standard deviation is 18.75% compared to the category average of 13.78%. This makes the fund more volatile than its peers over the past half-decade.

Risk Factors

The fund has a 5-year beta of 0.71, so investors should note that it is hypothetically less 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 -2.97, 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, SEKIX is a no load fund. It has an expense ratio of 0.91% compared to the category average of 0.96%. From a cost perspective, SEKIX is actually cheaper than its peers.

Investors should also note that the minimum initial investment for the product is $1.00 million and that each subsequent investment has no minimum amount.

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

Bottom Line

Overall, DWS Emerging Markets Equity Instl ( SEKIX ) has a low Zacks Mutual Fund rank, and in conjunction with its comparatively weak performance, average downside risk, and lower fees, this fund looks like 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.

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This article originally published on Zacks Investment Research (zacks.com).

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