Is American Century Ultra Investor (TWCUX) a Strong Mutual Fund Pick Right Now?

Having trouble finding a Large Cap Growth fund? Well, American Century Ultra Investor (TWCUX) would not be a good potential starting point right now. TWCUX possesses a Zacks Mutual Fund Rank of 4 (Sell), which is based on various forecasting factors like size, cost, and past performance.

TWCUX is part of the Large Cap Growth section, and this segment boasts an array of other possible options. Large Cap Growth mutual funds purchase stakes in numerous large U.S. companies that are expected to develop and grow at a faster rate than other large-cap stocks. Companies are usually considered to be large-cap if their market capitalization is over $10 billion.

TWCUX finds itself in the American Century family, based out of Kansas City, MO. American Century Ultra Investor debuted in November of 1981. Since then, TWCUX has accumulated assets of about $20.59 billion, according to the most recently available information. The fund’s current manager is a team of investment professionals.

Investors naturally seek funds with strong performance. TWCUX has a 5-year annualized total return of 15.61% 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 17.07%, which places it in the middle 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. TWCUX’s standard deviation over the past three years is 20.93% compared to the category average of 14.42%. The fund’s standard deviation over the past 5 years is 21.4% compared to the category average of 14.19%. This makes the fund more volatile than its peers over the past half-decade.

The fund has a 5-year beta of 1.24, so investors should note that it is hypothetically more volatile than the market at large. 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. TWCUX’s 5-year performance has produced a negative alpha of -2.43, which means managers in this portfolio find it difficult to pick securities that generate better-than-benchmark returns.