Is Eaton Vance Tax-Managed Equity Asset Allocation A (EAEAX) a Strong Mutual Fund Pick Right Now?
If you've been stuck searching for Mutual Fund Equity Report funds, consider Eaton Vance Tax-Managed Equity Asset Allocation A (EAEAX) as a possibility. EAEAX possesses a Zacks Mutual Fund Rank of 2 (Buy), which is based on nine forecasting factors like size, cost, and past performance.
History of Fund/Manager
EAEAX is a part of the Eaton Vance family of funds, a company based out of Boston, MA. The Eaton Vance Tax-Managed Equity Asset Allocation A made its debut in March of 2002 and EAEAX has managed to accumulate roughly $401.56 million in assets, as of the most recently available information. John Croft is the fund's current manager and has held that role since June of 2015.
Performance
Obviously, what investors are looking for in these funds is strong performance relative to their peers. This fund in particular has delivered a 5-year annualized total return of 8.07%, and it sits 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 6.58%, 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 EAEAX over the past three years is 18.39% compared to the category average of 15.99%. The fund's standard deviation over the past 5 years is 16.45% compared to the category average of 14.26%. This makes the fund more volatile than its peers over the past half-decade.
Risk Factors
Investors should note that the fund has a 5-year beta of 0.96, which means it is hypothetically less volatile than 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. With a negative alpha of -2.54, managers in this portfolio find it difficult to pick securities that generate better-than-benchmark returns.
Holdings
Examining the equity holdings of a mutual fund is also a valuable exercise. This can show us how the manager is applying their stated methodology, as well as if there are any inherent biases in their approach. For this particular fund, the focus is largely on equities that are traded in the United States.
Currently, this mutual fund is holding 93.24% stock in stocks and it has a negligible amount of assets in foreign securities. Turnover is 6%, which means, on average, the fund makes fewer trades than the average comparable fund.
Expenses
As competition heats up in the mutual fund market, costs become increasingly important. Compared to its otherwise identical counterpart, a low-cost product will be an outperformer, all other things being equal. Thus, taking a closer look at cost-related metrics is vital for investors. In terms of fees, EAEAX is a load fund. It has an expense ratio of 1.26% compared to the category average of 0.86%. From a cost perspective, EAEAX is actually more expensive than its peers.
This fund requires a minimum initial investment of $1,000, while there is no minimum for each subsequent investment.
Bottom Line
Overall, Eaton Vance Tax-Managed Equity Asset Allocation A ( EAEAX ) has a high Zacks Mutual Fund rank, and in conjunction with its comparatively strong performance, average downside risk, and higher fees, this fund looks like a good potential choice for investors right now.
This could just be the start of your research on EAEAXin the Mutual Fund Equity Report category. Consider going to www.zacks.com/funds/mutual-funds for additional information about this fund, and all the others that we rank 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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