If you have been looking for Index funds, a place to start could be ONEFUND S&P 500 (INDEX – Free Report) . INDEX carries a Zacks Mutual Fund Rank of 2 (Buy), which is based on various forecasting factors like size, cost, and past performance.
History of fund/manager
Index Funds is responsible for INDEX, and the company is based out of Denver, CO. ONEFUND S&P 500 made its debut in April of 2015, and since then, INDEX has accumulated about $154.61 million in assets, per the most up-to-date date available. The fund’s current manager, Michael Willis, has been in charge of the fund since April of 2015.
Performance
Obviously, what investors are looking for in these funds is strong performance relative to their peers. This fund has delivered a 5-year annualized total return of 17.01%, and it sits in the top 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 17.97%, which places it in the bottom 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 INDEX over the past three years is 13.92% compared to the category average of 13.78%. Over the past 5 years, the standard deviation of the fund is 16.65% compared to the category average of 15.9%. This makes the fund more volatile than its peers over the past half-decade.
Risk factors
Investors should not forget about beta, an important way to measure a mutual fund’s risk compared to the market as a whole. INDEX has a 5-year beta of 1.01, which means it is likely to be as volatile as the market average. 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. The fund has produced a negative alpha over the past 5 years of -0.55, which shows that managers in this portfolio find it difficult to pick securities that generate better-than-benchmark returns.
Holdings
Investigating 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.
As of the last filing date, the mutual fund has 83.92% of its assets in stocks, which have an average market capitalization of $572.68 billion. The fund has the heaviest exposure to the following market sectors:
- Technology.
- Finance.
- Retail Trade.
This fund’s turnover is about 18%, so the fund managers are making more traders than comparable funds in a given year.
Expenses
Costs are increasingly important for mutual fund investing, and particularly as competition heats up in this market. And all things being equal, a lower cost product will outperform its otherwise identical counterpart, so taking a closer look at these metrics is key for investors. In terms of fees, INDEX is a no load fund. It has an expense ratio of 0.25% compared to the category average of 0.71%. INDEX is actually cheaper than its peers when you consider factors like cost.
This fund requires a minimum initial investment of $1,000, and each subsequent investment should be at least $100.
Fees charged by investment advisors have not been taken into consideration. Returns would be less if those were included.
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