If you've been stuck searching for China - Equity funds, you might want to consider passing on by ProFunds UltraChina Investor (UGPIX) as a possibility. UGPIX holds a Zacks Mutual Fund Rank of 5 (Strong Sell), which is based on nine forecasting factors like size, cost, and past performance.
Objective
We note that UGPIX is a China - Equity option, an area loaded with different options. China - Equity mutual funds and their investments revolve around stocks in China, Taiwan, and Hong Kong. China's middle class is booming, and its economy reflect this demographic's rise more than the vast export-focused manufacturing one we typically associate with the country. Even if this strategy sounds enticing, you may want to look past UGPIX.
History of Fund/Manager
ProFunds is based in Columbus, OH, and is the manager of UGPIX. Since ProFunds UltraChina Investor made its debut in February of 2008, UGPIX has garnered more than $27.45 million in assets. Alexander V. Ilyasov is the fund's current manager and has held that role since November of 2009.
Performance
Investors naturally seek funds with strong performance. This fund in particular has delivered a 5-year annualized total return of 4.14%, and is in the top third among its category peers. If you're interested in shorter time frames, do not dismiss looking at the fund's 3-year annualized total return of 15.23%, 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. Looking at the past 5 years, the fund's standard deviation is 42.92% compared to the category average of 1.5%. This makes the fund more volatile than its peers over the past half-decade.
Risk Factors
It's always important to be aware of the downsides to any future investment, so one should not discount the risks that come with this segment.
Nevertheless, with a 5-year beta of 2.64, the fund 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. Over the past 5 years, the fund has a negative alpha of -14.02. This means that managers in this portfolio find it difficult to pick securities that generate better-than-benchmark returns.
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, UGPIX is a no load fund and it has an expense ratio of 1.51%.
Investors need to be aware that with this product, the minimum initial investment is $15,000; each subsequent investment has no minimum amount.
Bottom Line
With a 'strong sell' rank, ProFunds UltraChina Investor is in the bottom 20% of all the mutual funds we cover. This means that our models suggest it is one of the worst options for investors in China - Equity right now, though this could change if the performance of the fund and the Zacks Ranks of the equities in UGPIX turnaround in the next data release.
Want even more information about UGPIX? Then go over to Zacks.com and check out our mutual fund comparison tool, and all of the other great features that we have to help you with your mutual fund analysis for additional information. If you want to check out our stock reports as well, make sure to go to Zacks.com to see all of the great tools we have to offer, including our time-tested Zacks Rank.
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