ACGIX
Invesco Growth & Income-A
Strategic Blend of Income and Growth
Invesco Growth & Income-A (ACGIX) is designed to provide investors with a balanced approach to income and capital appreciation. The fund primarily invests in income-producing equity securities, including common stocks and convertible securities, which aligns with its objective of growth and income. This strategic blend makes it an attractive option for investors seeking a dual approach to wealth accumulation. The fund’s focus on large-cap value stocks offers a stable foundation, while its inclusion of convertible securities provides an additional layer of growth potential. This dual strategy is particularly appealing in volatile markets, where income generation can offset potential capital losses.
At A Glance
Executive Summary
ACGIX offers a strategic blend of income and growth with a focus on large-cap value stocks, featuring a competitive 0.79% expense ratio.
Blend of income and growth potential; Focus on large-cap value stocks; Competitive expense ratio
Negative alpha and Sharpe ratio; High cash allocation; Recent max drawdown
Performance Analysis: A Year of Growth
Over the past year, ACGIX has delivered a robust return of 34.38%, showcasing its ability to capitalize on market opportunities. This performance, while slightly trailing the S&P 500 Total Return Index’s 37.62%, demonstrates the fund’s capacity to generate significant returns in a growth-oriented market environment. The fund’s annualized returns over five years stand at 12.06%, indicating consistent performance over a longer horizon. However, investors should note the fund’s negative alpha of -3.28%, suggesting it has underperformed its benchmark on a risk-adjusted basis. Despite this, the fund’s strong one-year return highlights its potential for capital appreciation.
Portfolio Composition: A Focus on Financials and Technology
ACGIX’s portfolio is heavily weighted towards financials and technology, with allocations of 18.93% and 16.31% respectively. This sector allocation reflects the fund’s strategy to leverage growth opportunities in these dynamic sectors. Financials, being a significant portion of the portfolio, provide a steady income stream, while technology offers growth potential through innovation and market expansion. The fund’s top holdings, including Wells Fargo & Co and Bank of America Corp, underscore its commitment to financials, while investments in Alphabet Inc and Oracle Corp highlight its focus on technology. This diversified sector approach aims to balance income and growth, aligning with the fund’s overall objectives.
Risk Metrics: Navigating Market Volatility
ACGIX exhibits a beta of 0.80, indicating lower volatility compared to the broader market. This lower beta suggests that the fund may offer a degree of protection during market downturns, making it suitable for risk-averse investors. However, the fund’s Sharpe ratio of -0.28 and Treynor ratio of -4.12 indicate that it has not effectively compensated investors for the risk taken. The fund’s standard deviation of 3.34% reflects moderate volatility, while its downside risk (UI) of 1.85 suggests a relatively controlled risk profile. Despite these metrics, the fund’s max drawdown of -6.5% highlights the potential for significant short-term losses, which investors should consider.
Competitive Expense Ratio and Yield
ACGIX offers a competitive expense ratio of 0.79%, which is relatively low for a fund in the large-cap value category. This cost efficiency can enhance net returns for investors, making it an attractive option for those seeking value without high fees. Additionally, the fund provides a yield of 1.21%, offering a modest income stream that complements its growth potential. This yield, while not the highest in its category, provides a steady income source that can be reinvested for compounding growth. The combination of a competitive expense ratio and a reasonable yield makes ACGIX a compelling choice for cost-conscious investors.
Comparative Analysis: Standing Among Peers
When compared to similar funds such as Russell Inv Sustainable Equity-Y (REUYX) and Sit Dividend Growth-I (SDVGX), ACGIX holds its ground with a strong one-year return of 34.38%. While its expense ratio of 0.79% is higher than some peers, it remains competitive within the large-cap value space. The fund’s yield of 1.21% is comparable to peers like SDVGX, which offers a yield of 1.09%. However, ACGIX’s negative alpha and Sharpe ratio may be a concern for investors seeking risk-adjusted returns. Despite these challenges, ACGIX’s performance and strategic sector allocation make it a viable option for investors looking for a blend of growth and income.
Sector and Asset Allocation: A Balanced Approach
ACGIX’s sector allocation is diversified across financials, technology, and health care, which together constitute a significant portion of the portfolio. This diversification helps mitigate sector-specific risks and provides exposure to various growth drivers. The fund’s asset allocation is predominantly in U.S. equities, accounting for 90.33% of the portfolio, with a small allocation to non-U.S. equities at 7.15%. This focus on domestic equities aligns with the fund’s large-cap value strategy, providing stability and growth potential. The fund’s cash allocation of 2.52% offers liquidity, while its lack of bond exposure emphasizes its equity-centric approach.
Conclusion: A Strategic Choice for Value Investors
Invesco Growth & Income-A (ACGIX) stands out as a strategic choice for investors seeking a blend of income and growth within the large-cap value category. Its competitive expense ratio, coupled with a diversified sector allocation, provides a balanced approach to investing. While the fund’s risk metrics and recent max drawdown may raise concerns, its strong one-year performance and focus on financials and technology sectors offer compelling growth opportunities. ACGIX is particularly suitable for investors who prioritize cost efficiency and sector diversification, making it a valuable addition to a diversified investment portfolio.
Similar Securities
FISEX: Franklin Equity Income-A | High Income & Capital Appreciation
FISEX offers a blend of high income and capital appreciation with a competitive 0.83% expense ratio, focusing on large-cap value stocks.
PRFDX: TRPrice Equity Income-Inv | High Dividend Large Cap Value Fund
PRFDX offers substantial dividend income and growth with a 0.68% expense ratio, focusing on established companies with above-average dividends.
CGRWX: Invesco Comstock Select-A | Value-Focused Growth Fund
CGRWX offers a unique blend of undervalued stocks with growth potential, boasting a 27.51% 1-year return and a 0.92% expense ratio.
MADVX: BlackRock Equity Dividend-Inst | High-Yield Large Cap Value Fund
MADVX offers a 2.34% yield with a focus on dividend-paying large-cap stocks, underperforming its benchmark but providing stable income.
DODGX: Dodge & Cox Stock-I | Growth and Income with Value Focus
Dodge & Cox Stock-I (DODGX) offers a balanced approach to growth and income with a competitive 0.51% expense ratio and strong sector diversification.
Futher Reading
https://finance.yahoo.com/quote/ACGIX/”>Yahoo: Invesco Growth & Income-A
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