Is AMG Yacktman I (YACKX) a Strong Mutual Fund Pick Right Now?

Zacks Equity Research
·3-min read

Having trouble finding an All Cap Value fund? AMG Yacktman I (YACKX) is a potential starting point. YACKX carries a Zacks Mutual Fund Rank of 1 (Strong Buy), which is based on nine forecasting factors like size, cost, and past performance.

Objective

Zacks categorizes YACKX as All Cap Value, which is a segment packed with options. All Cap Value mutual funds, as the name suggests, invest across the cap spectrum in small-cap, mid-cap, and large-cap companies. However, in practice, these funds generally end up focusing on larger companies thanks to their percentage of assets. Regardless, these funds look for value positions, targeting firms whose share prices do not reflect their full worth, as well as low P/E Ratios and high dividend yields.

History of Fund/Manager

YACKX finds itself in the AMG Funds family, based out of Norwalk, CT. AMG Yacktman I made its debut in July of 1992, and since then, YACKX has accumulated about $6.47 billion in assets, per the most up-to-date date available. Stephen Yacktman is the fund's current manager and has held that role since December of 2002.

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 9.87%, and is in the top third among its category peers. Investors who prefer analyzing shorter time frames should look at its 3-year annualized total return of 7.68%, which places it in the top 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. Over the past three years, YACKX's standard deviation comes in at 14%, compared to the category average of 18.56%. Looking at the past 5 years, the fund's standard deviation is 11.71% compared to the category average of 15.9%. This makes the fund less volatile than its peers over the past half-decade.

Risk Factors

With a 5-year beta of 0.72, the fund is likely to be less volatile than the market average. 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. The fund has produced a negative alpha over the past 5 years of -0.52, which shows that 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, YACKX is a no load fund. It has an expense ratio of 0.71% compared to the category average of 1.04%. Looking at the fund from a cost perspective, YACKX is actually cheaper than its peers.

Investors need to be aware that with this product, the minimum initial investment is $100,000; each subsequent investment needs to be at least $100.

Bottom Line

Overall, AMG Yacktman I ( YACKX ) has a high Zacks Mutual Fund rank, and in conjunction with its comparatively strong performance, average downside risk, and lower fees, this fund looks like a good potential choice for investors right now.

For additional information on this product, or to compare it to other mutual funds in the All Cap Value, make sure to go to www.zacks.com/funds/mutual-funds for additional information. If you are more of a stock investor, make sure to also check out our Zacks Rank, and our full suite of tools we have available for novice and professional investors alike.


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