If investors are looking at the Sector – Tech fund category, Red Oak Technology Select (ROGSX) could be a potential option. ROGSX bears a Zacks Mutual Fund Rank of 2 (Buy), which is based on nine forecasting factors like size, cost, and past performance.
ROGSX is part of the Sector – Tech category, which boasts an array of different possible selections. With a much more diversified approach, Sector – Tech mutual funds give investors a way to own a stake in a notoriously risky sector. Tech companies are in various industries like semiconductors, software, internet, and networking, among others.
History of Fund/Manager
Oak Associates is based in Akron, OH, and is the manager of ROGSX. Red Oak Technology Select debuted in December of 1998. Since then, ROGSX has accumulated assets of about $558.27 million, 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. This fund has delivered a 5-year annualized total return of 23.35%, 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 21.39%, which places it in the middle 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. ROGSX’s standard deviation over the past three years is 17.99% compared to the category average of 22.01%. Looking at the past 5 years, the fund’s standard deviation is 16.2% compared to the category average of 19.69%. This makes the fund less volatile than its peers over the past half-decade.
Investors should note that the fund has a 5-year beta of 1, which means it is hypothetically as volatile as 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. ROGSX has generated a positive alpha over the past five years of 8.09, demonstrating that managers in this portfolio are skilled in picking securities that generate better-than-benchmark returns.
Examining 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.
Currently, this mutual fund is holding 97.46% stock in stocks, which have an average market capitalization of $417.33 billion. Turnover is about 2%, so those in charge of the fund make fewer trades than the average comparable fund.
For investors, taking a closer look at cost-related metrics is key, since costs are increasingly important for mutual fund investing. Competition is heating up in this space, and a lower cost product will likely outperform its otherwise identical counterpart, all things being equal. In terms of fees, ROGSX is a no load fund. It has an expense ratio of 0.94% compared to the category average of 1.38%. ROGSX is actually cheaper than its peers when you consider factors like cost.
Investors need to be aware that with this product, the minimum initial investment is $2,000; each subsequent investment needs to be at least $25.
Overall, Red Oak Technology Select ( ROGSX ) has a high Zacks Mutual Fund rank, and in conjunction with its comparatively strong performance, average downside risk, and lower fees, Red Oak Technology Select ( ROGSX ) looks like a good potential choice for investors right now.
For additional information on the Sector – Tech area of the mutual fund world, make sure to check out www.zacks.com/funds/mutual-funds. There, you can see more about the ranking process, and dive even deeper into ROGSX too for additional information. And don’t forget, Zacks has all of your needs covered on the equity side too! Make sure to check out Zacks.com for more information on our screening capabilities, Rank, and all our articles as well.
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