Is Schwab Health Care Fund (SWHFX) a Strong Mutual Fund Pick Right Now?
Have you been searching for a Mutual Fund Equity Report fund? You might want to begin with Schwab Health Care Fund (SWHFX). SWHFX possesses a Zacks Mutual Fund Rank of 3 (Hold), which is based on various forecasting factors like size, cost, and past performance.
History of Fund/Manager
SWHFX is a part of the Schwab Funds family of funds, a company based out of San Francisco, CA. Schwab Health Care Fund debuted in June of 2000. Since then, SWHFX has accumulated assets of about $828.51 million, according to the most recently available information. Wei Li is the fund's current manager and has held that role since June of 2013.
Performance
Obviously, what investors are looking for in these funds is strong performance relative to their peers. SWHFX has a 5-year annualized total return of 6.09% and it sits 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 5.8%, 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. Compared to the category average of 17.07%, the standard deviation of SWHFX over the past three years is 15.34%. Looking at the past 5 years, the fund's standard deviation is 15.69% compared to the category average of 18.72%. This makes the fund less volatile than its peers over the past half-decade.
Risk Factors
With a 5-year beta of 0.68, the fund is likely to be less volatile than the market average. 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 -1.06, managers in this portfolio find it difficult to pick securities that generate better-than-benchmark returns.
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, SWHFX is a no load fund. It has an expense ratio of 0.79% compared to the category average of 1.28%. From a cost perspective, SWHFX is actually cheaper than its peers.
Investors should also note that the minimum initial investment for the product is $0 and that each subsequent investment has no minimum amount.
Fees charged by investment advisors have not been taken into considiration. Returns would be less if those were included.
Bottom Line
Overall, Schwab Health Care Fund ( SWHFX ) has a neutral Zacks Mutual Fund rank, and in conjunction with its comparatively similar performance, average downside risk, and lower fees, this fund looks like a somewhat average choice for investors right now.
Your research on the Mutual Fund Equity Report segment doesn't have to stop here. You can check out all the great mutual fund tools we have to offer by going to www.zacks.com/funds/mutual-funds to see the additional features we offer 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.
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 (SWHFX): Fund Analysis Report
