Large Cap Growth fund seekers should not consider taking a look at PGIM Jennison Focused Growth A (SPFAX) at this time. SPFAX carries a Zacks Mutual Fund Rank of 4 (Sell), which is based on various forecasting factors like size, cost, and past performance.
Objective
SPFAX 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
SPFAX is a part of the PGIM family of funds, a company based out of Providence, RI. PGIM Jennison Focused Growth A made its debut in June of 2000, and since then, SPFAX has accumulated about $1.16 billion in assets, per the most up-to-date date available. A team of investment professionals is the fund’s current manager.
Performance
Of course, investors look for strong performance in funds. This fund in particular has delivered a 5-year annualized total return of 8.73%, and it sits 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 24.19%, 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. SPFAX’s standard deviation over the past three years is 17.82% compared to the category average of 12.2%. Over the past 5 years, the standard deviation of the fund is 22.15% compared to the category average of 14.56%. This makes the fund more volatile than its peers over the past half-decade.
Risk Factors
The fund has a 5-year beta of 1.26, so investors should note that it is hypothetically 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. SPFAX has generated a negative alpha over the past five years of -5.72, demonstrating that managers in this portfolio find it difficult to pick securities that generate better-than-benchmark returns.
