Is Harbor Capital Appreciation Institutional (HACAX) a Strong Mutual Fund Pick Right Now?

If investors are looking at the Large Cap Growth fund category, Harbor Capital Appreciation Institutional (HACAX) could be a potential option. HACAX bears a Zacks Mutual Fund Rank of 2 (Buy), which is based on various forecasting factors like size, cost, and past performance.

HACAX is classified in the Large Cap Growth segment by Zacks, an area full of possibilities. Companies are usually considered to be large-cap if their stock market valuation is more than $10 billion. Large Cap Growth mutual funds invest in many large U.S. firms that are projected to grow at a faster rate than their large-cap peers.

Harbor Funds is based in Chicago, IL, and is the manager of HACAX. The Harbor Capital Appreciation Institutional made its debut in December of 1987 and HACAX has managed to accumulate roughly $17.01 billion in assets, as of the most recently available information. The fund’s current manager is a team of investment professionals.

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 17.71%, 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 14.38%, 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 15.7%, the standard deviation of HACAX over the past three years is 21.98%. The fund’s standard deviation over the past 5 years is 23.5% compared to the category average of 16.85%. This makes the fund more volatile than its peers over the past half-decade.

Investors should not forget about beta, an important way to measure a mutual fund’s risk compared to the market as a whole. HACAX has a 5-year beta of 1.19, which means it is likely to be more volatile than 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. With a negative alpha of -0.8, managers in this portfolio find it difficult to pick securities that generate better-than-benchmark returns.