Is American Funds New Economy A (ANEFX) a Strong Mutual Fund Pick Right Now?

There are plenty of choices in the Global - Equity category, but where should you start your research? Well, one fund that might be worth investigating is American Funds New Economy A (ANEFX). ANEFX has a Zacks Mutual Fund Rank of 2 (Buy), which is based on various forecasting factors like size, cost, and past performance.ObjectiveZacks categorizes ANEFX as Global - Equity, which is a segment packed with options. Global - Equity mutual funds invest in large markets like the U.S., Europe, and Japan, and operate with very few geographical limitations. They also provide an investment technique that leverages the diverse nature of the global economy in the hopes of providing a stable return.History of Fund/ManagerAmerican Funds is based in Los Angeles, CA, and is the manager of ANEFX. American Funds New Economy A made its debut in December of 1983, and since then, ANEFX has accumulated about $17.14 billion in assets, per the most up-to-date date available. The fund is currently managed by a team of investment professionals.PerformanceInvestors naturally seek funds with strong performance. This fund has delivered a 5-year annualized total return of 11.32%, and is in the middle 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 19.05%, which places it in the top 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 ANEFX over the past three years is 15.41% compared to the category average of 14.01%. The fund's standard deviation over the past 5 years is 17.06% compared to the category average of 13.54%. This makes the fund more volatile than its peers over the past half-decade.Risk FactorsThe fund has a 5-year beta of 0.97, so investors should note that it is hypothetically as volatile as 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 negative alpha of -3.45, managers in this portfolio find it difficult to pick securities that generate better-than-benchmark returns.ExpensesFor investors, taking a closer look at cost-related metrics is key, since costs are increasingly important for mutual fund investing. Competition is heating up in this space, and a lower cost product will likely outperform its otherwise identical counterpart, all things being equal. In terms of fees, ANEFX is a load fund. It has an expense ratio of 0.73% compared to the category average of 0.95%. ANEFX is actually cheaper than its peers when you consider factors like cost.Investors need to be aware that with this product, the minimum initial investment is $250; each subsequent investment needs to be at least $50.Fees charged by investment advisors have not been taken into consideration. Returns would be less if those were included.Bottom LineOverall, American Funds New Economy A ( ANEFX ) has a high Zacks Mutual Fund rank, and in conjunction with its comparatively similar performance, average downside risk, and lower fees, this fund looks like a great potential choice for investors right now.For additional information on this product, or to compare it to other mutual funds in the Global - Equity, make sure to go to www.zacks.com/funds/mutual-funds for additional information. Zacks provides a full suite of tools to help you analyze your portfolio - both funds and stocks - in the most efficient way possible.Quantum Computing Stocks Set To SoarArtificial intelligence has already reshaped the investment landscape, and its convergence with quantum computing could lead to the most significant wealth-building opportunities of our time.Today, you have a chance to position your portfolio at the forefront of this technological revolution. In our urgent special report, Beyond AI: The Quantum Leap in Computing Power, you'll discover the little-known stocks we believe will win the quantum computing race and deliver massive gains to early investors.Access the Report Free Now >>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Get Your Free (ANEFX): Fund Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).Zacks Investment ResearchWeiter zum vollständigen Artikel bei Zacks Weiter zum vollständigen Artikel bei Zacks