3 / 5 Stars
4 4 5 5 3
Zacks Investment Research
Standard & Poor's
3 / 5 Stars
#97 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 21.55 percent over the past year, 15.28 percent over the past three years, 17.77 percent over the past five years, and 8.17 percent over the past decade.
|Trailing Returns||Updated 06.30.2014|
|Year to date||6.7%|
|3 Years (Annualized)||15.3%|
|5 Years (Annualized)||17.8%|
|10 Years (Annualized)||8.2%|
This fund, one of many Van Kampen funds purchased by Invesco in early 2010, invests in the stock of large, well-known blue chips. It leans strongly toward U.S. value stocks, which are cheaper relative to earnings or sales.
As of July 03, 2014, the fund has assets totaling almost $9.49 billion invested in 86 different holdings. Its portfolio consists primarily of U.S. large- and mega-cap corporations, with about 8 percent dedicated to companies in developed foreign economies. Morningstar considers the fund a large-cap value fund.
The fund’s solid U.S. News ranking is a product of its long-term record. In the short term, bungles, like selling BP well after the Gulf oil spill shaved billions off the stock’s market capitalization, have hurt the fund’s return relative to its peers. The fund has, however, met its goal of producing both income and capital appreciation. Its returns were meager for most of the 2010, but gains in the final quarter helped the fund achieve a double digit-return. Meanwhile, things have been looking up this year, with the fund's returns beating both the S&P 500 and the average for Morningstar's large value category as of late March. The fund's position in Viacom was particularly helfpul in the opening months of 2011. The fund has returned 21.55 percent over the past year and 15.28 percent over the past three years.
The fund’s appeal is its ability to withstand market downturns, such as when it lost 5 percent less than its category and the S&P 500 in the 2008 collapse. Its low expense ratio—just 0.88 percent—makes it one of the better deals among broker-administered funds. But, Morningstar says, “Invesco’s agreement to hold fees steady expires in less than two years, and higher costs here would weaken the case for an otherwise appealing option.” The fund has returned 17.77 percent over the past five years and 8.17 percent over the past decade.
The fund has a long-term, buy-and-hold strategy, selling the average stock only after holding it for five years. Management invests in companies it believes to be undervalued when it sees new signs that point to a resurgence in a company’s earnings prospects.
Role in Portfolio
Morningstar recommends this fund play a “core” role in your portfolio and says, “Management’s moderate strategy makes the fund a good choice for a portfolio’s foundation.”
Since the Invesco buyout, the fund’s Van Kampen team has remained intact. Tom Bastian took over as lead manager from James Gilligan in 2008, who had led the fund to respectable gains since 1990. Bastian had already been with the team since 2003 and his co-managers James Roeder, Serio Marcheli, and Mark Laskin remained with the fund. Mary Jayne Maly, who specializes in the healthcare and industrials sectors, joined fund management in 2008 after managing other Van Kampen funds since 1992.
Invesco Growth and Income Fund has an expense ratio of 0.81 percent.
Generally, the fund appears to have below-average risk, sporting a standard deviation (a measure of volatility) of less than the S&P 500. By holding nearly 90 percent of its portfolio in U.S. large-cap value stocks, the fund could suffer if this asset class performs poorly.