2 / 5 Stars
1 1 5 2 2
Zacks Investment Research
5 (Strong Sell)
Standard & Poor's
3 / 5 Stars
#192 in Large Value
U.S. News evaluated 330 Large Value Funds. Our list highlights the top-rated funds for long-term investors based on the ratings of leading fund industry researchers.
The fund has returned 15.37 percent over the past year, 12.33 percent over the past three years, 13.98 percent over the past five years, and 7.14 percent over the past decade.
|Trailing Returns||Updated 06.30.2014|
|Year to date||8.0%|
|3 Years (Annualized)||12.3%|
|5 Years (Annualized)||14.0%|
|10 Years (Annualized)||7.1%|
American Century Equity Income has produced top-notch long-term numbers.
As of July 03, 2014, the fund has assets totaling almost $10.25 billion invested in 85 different holdings. Its portfolio consists primarily of shares of large companies.
In this fund, investors can expect to find plenty of familiar names. For instance, big blue chips like AT&T, Exxon Mobil, and Johnson & Johnson all occupy prominent spots in its portfolio. This focus on blue chips helped the fund in 2008, when it lost nearly 17 percentage points less than the S&P 500. But the fund's tame makeup has held it back since then. Notably, when riskier fare rallied, the fund failed to participate in the market's heated rally. The fund has struggled quite a bit in 2011, and its returns for the first quarter landed it in the bottom three percent of its Morningstar category. One factor that sets this fund apart is its use of convertible bonds. These bonds, which can be converted into stocks, offer exposure to the benefits of equities, but with less risk. The fund has returned 15.37 percent over the past year and 12.33 percent over the past three years.
Historically, the fund has had its fair share of off years. Since 2001, it has finished in the bottom 15 percent of its Morningstar category in three separate years. Still, over the long haul, the fund's focus on dividend-paying stocks and on strong companies trading at a discount has paid off. As of the end of the first quarter of 2011, its trailing 10-year returns beat those of the S&P 500 by upwards of 3 percentage points per year. The fund has returned 13.98 percent over the past five years and 7.14 percent over the past decade.
According to the fund's prospectus: "The portfolio managers look for equity securities of companies with a favorable income-paying history that have prospects for income payments to continue or increase. The portfolio managers also look for equity securities of companies that they believe are undervalued and have the potential for an increase in price. To identify these undervalued companies, the portfolio managers look for companies with earnings, cash flows and/or assets that may not be reflected in the companies' stock prices or may be outside the companies' historical ranges."
Role in Portfolio
Morningstar calls this fund a "core" holding.
A team of three managers runs the fund.
American Century Investments Equity Income Fund has an expense ratio of 1.18 percent.
Like all stock funds, this one comes with some risks.