OAAIX
Invesco Select Risk High Growth Inv-A
Strategic Asset Allocation for Growth
The Invesco Select Risk High Growth Inv-A (OAAIX) is designed for investors seeking aggressive growth through a strategic allocation of assets. The fund invests 70% of its net assets in U.S. equities and 30% in international equities, providing a diversified exposure to both domestic and global markets. This allocation is intended to capitalize on growth opportunities across different regions, enhancing the potential for long-term capital appreciation. The fund’s focus on equities aligns with its aggressive growth objective, making it suitable for investors with a higher risk tolerance who are looking to maximize returns over time.
At A Glance
Executive Summary
OAAIX offers aggressive growth with a 70% U.S. and 30% international equity split, outperforming peers with a 23.73% 1-year return.
High 1-year return of 23.73%. Diversified U.S. and international equity exposure. Strong risk-adjusted metrics with a Sharpe Ratio of 0.57.
Higher expense ratio at 0.90%. Lower yield compared to some peers. Aggressive strategy may not suit conservative investors.
Impressive Recent Performance
OAAIX has demonstrated impressive performance, particularly over the past year, with a 1-year return of 23.73%. This performance significantly outpaces its benchmark, the MSCI ACWI xUS DivAdj Idx, which returned 17.25% over the same period. The fund’s ability to outperform its benchmark highlights its effective asset allocation strategy and the skill of its management team in navigating market conditions. This strong performance is a key selling point for investors seeking high returns, although it is important to consider the associated risks of an aggressive investment strategy.
Risk Metrics and Volatility Management
The fund’s risk metrics indicate a well-managed approach to volatility, with a beta of 0.79, suggesting lower volatility compared to the market. The Sharpe Ratio of 0.57 reflects a favorable risk-adjusted return, indicating that the fund has been able to generate returns efficiently relative to its risk. Additionally, the fund’s alpha of 6.46% suggests that it has outperformed the market on a risk-adjusted basis. These metrics are crucial for investors who are concerned about the potential risks associated with aggressive growth strategies, as they demonstrate the fund’s ability to manage volatility while pursuing high returns.
Sector and Market Cap Diversification
OAAIX offers a diversified portfolio across various sectors and market capitalizations, which helps mitigate risk and capture growth opportunities. The fund has a significant allocation to the technology sector at 23.97%, reflecting its focus on high-growth industries. Other notable sector allocations include financials at 13.85% and industrials at 12.51%. In terms of market capitalization, the fund is diversified across small, medium, and large-cap stocks, with a notable 27.41% in extra-large cap stocks. This diversification strategy is designed to balance risk and reward, providing exposure to both established and emerging companies.
Competitive Expense Ratio and Yield
While OAAIX has an expense ratio of 0.90%, which is higher than some of its peers, it is justified by the fund’s strong performance and strategic asset allocation. The fund’s yield of 0.94% is modest, reflecting its focus on capital appreciation rather than income generation. For investors prioritizing growth over income, the expense ratio may be a worthwhile trade-off given the fund’s potential for high returns. However, those seeking higher yields might consider alternative options with lower expense ratios and higher income potential.
Comparison with Similar Funds
When compared to similar funds, OAAIX stands out for its strong 1-year return of 23.73%, outperforming peers such as USAA Cornerstone Aggressive (UCAGX) and Allspring Asset Allocation-A (EAAFX). While its expense ratio is higher than some competitors, such as NYLI Growth Allocation-A (MGDAX) and Nationwide Investor Destn Mod Aggres-A (NDMAX), OAAIX’s superior performance may justify the additional cost for investors focused on growth. The fund’s aggressive strategy and diversified equity exposure make it a compelling choice for those looking to maximize capital appreciation in a competitive landscape.
Suitability for Aggressive Investors
OAAIX is particularly well-suited for aggressive investors who are willing to accept higher levels of risk in pursuit of substantial returns. The fund’s focus on equities, both domestic and international, aligns with the objectives of investors seeking to capitalize on growth opportunities across different markets. Its strong performance metrics and strategic asset allocation make it an attractive option for those with a long-term investment horizon and a high risk tolerance. However, conservative investors or those seeking stable income may find the fund’s aggressive approach less suitable for their investment goals.
Conclusion: A Strong Contender for Growth-Oriented Portfolios
In conclusion, the Invesco Select Risk High Growth Inv-A (OAAIX) offers a compelling option for investors seeking aggressive growth through a diversified equity portfolio. Its impressive recent performance, strategic asset allocation, and effective risk management make it a standout choice in the aggressive fund category. While the fund’s higher expense ratio and modest yield may be considerations for some, its potential for high returns and diversified exposure to both U.S. and international markets make it a strong contender for growth-oriented portfolios. Investors with a high risk tolerance and a focus on capital appreciation will find OAAIX to be a valuable addition to their investment strategy.
Similar Securities
SCHAX: Franklin Multi-Asset Growth Fund A | Dynamic Growth Strategy
SCHAX offers dynamic asset allocation with a focus on aggressive growth, featuring a diverse portfolio and competitive returns.
ACEIX: Invesco Equity & Income-A | Balanced Aggressive Growth & Income
ACEIX offers a balanced aggressive strategy with a focus on income and growth, featuring a competitive expense ratio and diversified holdings.
OAAAX: Invesco Active Allocation-A | Balanced Aggressive Growth Fund
OAAAX offers a balanced aggressive strategy with a 0.98% expense ratio, focusing on U.S. equities and tactical allocations for growth and income.
GWPAX: American Funds Growth-A | Aggressive Growth Strategy
GWPAX offers aggressive growth with a 35.41% 1-year return, global exposure, and a 0.75% expense ratio, outperforming its benchmark.
OAAIX: Invesco Select Risk High Growth Inv-A | Aggressive Growth Strategy
OAAIX offers aggressive growth with a 70% U.S. and 30% international equity split, outperforming peers with a 23.73% 1-year return.
Futher Reading
https://www.morningstar.com/funds/xnas/OAAIX/quote
https://finance.yahoo.com/quote/OAAIX/”>Yahoo: Invesco Select Risk High Growth Inv-A
https://ftcloud.fasttrack.net/web/chart/OAAIX
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