SAIFX
ClearBridge LargeCap Value-I
Strategic Focus on Large-Cap Value
ClearBridge LargeCap Value-I (SAIFX) is designed to provide investors with long-term growth of capital, while also offering current income as a secondary objective. The fund primarily invests in large-cap stocks, which are companies with market capitalizations similar to those in the Russell 1000 Index. This strategic focus on large-cap value stocks aims to deliver stability and growth, making it an attractive option for investors seeking a balanced approach to capital appreciation and income generation. The fund’s emphasis on large-cap stocks is intended to mitigate volatility and provide a more predictable investment experience, aligning with the needs of conservative investors who prioritize capital preservation.
At A Glance
Executive Summary
SAIFX offers a balanced approach with a 0.59% expense ratio, focusing on large-cap value stocks for growth and income, outperforming peers in stability.
Focus on large-cap value stocks for stability and growth. Competitive expense ratio of 0.59%. Strong sector diversification with financials and healthcare.
Negative alpha and Sharpe ratio indicate underperformance. High correlation with benchmark limits diversification. Limited upside potential with a -6.50% metric.
Performance Analysis: A Mixed Bag
The performance of SAIFX over the past year has been somewhat mixed. While the fund has achieved a notable one-year return of 24.71%, it falls short when compared to its benchmark, the S&P 500 Total Return Index, which posted a 37.62% return over the same period. This discrepancy highlights the challenges faced by the fund in capturing the full upside of the market. Additionally, the fund’s alpha of -12.95% and Sharpe ratio of -1.25 indicate that it has underperformed on a risk-adjusted basis. Despite these challenges, the fund’s five-year annualized return of 11.23% suggests a degree of resilience and potential for long-term growth.
Sector Allocation: A Diverse Portfolio
SAIFX boasts a well-diversified portfolio with significant allocations across various sectors. Financials lead the way with a 24.17% allocation, followed by healthcare at 16.95% and industrials at 11.62%. This sector diversification is designed to reduce risk and enhance the fund’s ability to capitalize on different economic cycles. The fund’s exposure to technology (11.30%) and utilities (8.40%) further underscores its commitment to maintaining a balanced portfolio. By investing in a broad range of sectors, SAIFX aims to provide investors with a stable and diversified investment vehicle that can weather market fluctuations.
Top Holdings: A Focus on Industry Leaders
The top holdings of SAIFX reflect its strategy of investing in industry-leading companies with strong market positions. Notable holdings include JPMorgan Chase & Co (4.89%), Sempra (4.22%), and ConocoPhillips (3.59%). These companies are recognized for their robust financial performance and potential for growth, aligning with the fund’s objective of capital appreciation. The inclusion of companies like American Express Co and UnitedHealth Group Inc further highlights the fund’s focus on sectors with strong growth prospects. By concentrating on well-established companies, SAIFX seeks to provide investors with a reliable source of returns.
Risk Metrics: Understanding the Downside
Investors should be aware of the risk metrics associated with SAIFX, which reveal some areas of concern. The fund’s beta of 0.71 suggests lower volatility compared to the market, which can be appealing to risk-averse investors. However, the negative alpha of -12.95% and Treynor ratio of -18.20 indicate that the fund has struggled to generate returns above its risk-adjusted expectations. Additionally, the fund’s downside risk (UI) of 1.99 and max drawdown of -5.4% highlight potential vulnerabilities during market downturns. These metrics suggest that while SAIFX offers some degree of stability, investors should be cautious of its limited upside potential.
Competitive Expense Ratio and Yield
SAIFX offers a competitive expense ratio of 0.59%, which is relatively low for a fund in the large-cap value category. This cost efficiency is a significant advantage for investors seeking to maximize their returns by minimizing fees. Additionally, the fund provides a yield of 1.26%, offering a modest income stream for investors. This combination of a low expense ratio and reasonable yield makes SAIFX an attractive option for cost-conscious investors who value both growth and income. By keeping expenses in check, the fund enhances its appeal to investors looking for a cost-effective way to invest in large-cap value stocks.
Comparison with Similar Funds
When compared to similar funds, SAIFX holds its ground in terms of performance and cost. For instance, Boston Trust Equity (BTEFX) and BNY Mellon Appreciation-Y (DGYGX) have similar one-year returns of 24.85% and 24.08%, respectively, but with slightly lower expense ratios. However, SAIFX’s focus on large-cap value stocks and its sector diversification set it apart from its peers. While Jensen Quality Growth-I (JENIX) and Franklin Rising Dividends-A (FRDPX) offer competitive returns, SAIFX’s strategic allocation and industry-leading holdings provide a unique investment proposition. Investors should consider these factors when evaluating SAIFX against its competitors.
Conclusion: A Balanced Choice for Value Investors
In conclusion, ClearBridge LargeCap Value-I (SAIFX) stands out as a balanced choice for investors seeking growth and income through large-cap value stocks. Its strategic focus on industry leaders and sector diversification offers a stable investment vehicle with the potential for long-term capital appreciation. While the fund faces challenges in terms of risk-adjusted performance and upside potential, its competitive expense ratio and yield make it an appealing option for cost-conscious investors. SAIFX is particularly suitable for those who prioritize stability and are willing to accept moderate returns in exchange for reduced volatility. Investors should weigh these factors carefully to determine if SAIFX aligns with their investment goals.
Similar Securities
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ACGIX: Invesco Growth & Income-A | Value-Focused Growth & Income Fund
ACGIX offers a strategic blend of income and growth with a focus on large-cap value stocks, featuring a competitive 0.79% expense ratio.
LBISX: BrandywineGLOBAL Dvrsf US LargeCp Val-IS | Undervalued Large-Cap Growth
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JIDVX: Janus Henderson US Dividend Income-I | Dividend-Focused Equity Fund
JIDVX offers a 1.91% yield with a focus on U.S. dividend-paying equities, maintaining a competitive 0.79% expense ratio.
SAIFX: ClearBridge LargeCap Value-I | Growth and Income with Large-Cap Stability
SAIFX offers a balanced approach with a 0.59% expense ratio, focusing on large-cap value stocks for growth and income, outperforming peers in stability.
Futher Reading
https://finance.yahoo.com/quote/SAIFX/”>Yahoo: ClearBridge LargeCap Value-I
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