On the lookout for a Sector - Energy fund? Starting with Invesco SteelPath MLP Income A (MLPDX) should not be a possibility at this time. MLPDX holds a Zacks Mutual Fund Rank of 4 (Sell), which is based on various forecasting factors like size, cost, and past performance.

Objective

We classify MLPDX in the Sector - Energy category, an area that is rife with possible choices. Throughout the massive global energy sector, Sector - Energy mutual funds hold a wide range of quickly changing and vitally important industries. While oil and gas comprise the bulk of the exposure, carbon-based fuels will be the biggest group of assets in these funds, though clean energy is starting to pick up steam.

History of Fund/Manager

Invesco is based in Kansas City, MO, and is the manager of MLPDX. Since Invesco SteelPath MLP Income A made its debut in April of 2010, MLPDX has garnered more than $2.20 billion in assets. Stuart Cartner is the fund's current manager and has held that role since April of 2010.

Performance

Of course, investors look for strong performance in funds. MLPDX has a 5-year annualized total return of 18.63%, and it sits in the bottom third among its category peers. If you're interested in shorter time frames, do not dismiss looking at the fund's 3-year annualized total return of 21.54%, which places it in the bottom third during this time-frame.

It is important to note that the product's returns may not reflect all its expenses. Any fees not reflected would lower the returns. Total returns do not reflect the fund's [%] sale charge. If sales charges were included, total returns would have been lower.

When looking at a fund's performance, it is also important to note the standard deviation of the returns. The lower the standard deviation, the less volatility the fund experiences. MLPDX's standard deviation over the past three years is 12.9% compared to the category average of 11.7%. The fund's standard deviation over the past 5 years is 16.02% compared to the category average of 13.82%. This makes the fund more volatile than its peers over the past half-decade.

Risk Factors

With a 5-year beta of 0.45, the fund is likely to be less volatile than the market average. Alpha is an additional metric to take into consideration, since it represents a portfolio's performance on a risk-adjusted basis relative to a benchmark, which in this case, is the S&P 500. Over the past 5 years, the fund has a positive alpha of 10.33. This means that managers in this portfolio are skilled in picking securities that generate better-than-benchmark returns.

Expenses

Costs are increasingly important for mutual fund investing, and particularly as competition heats up in this market. And all things being equal, a lower cost product will outperform its otherwise identical counterpart, so taking a closer look at these metrics is key for investors. In terms of fees, MLPDX is a load fund. It has an expense ratio of 1.33% compared to the category average of 1.02%. So, MLPDX is actually more expensive than its peers from a cost perspective.

Investors should also note that the minimum initial investment for the product is $1,000 and that each subsequent investment needs to be at $50.

Fees charged by investment advisors have not been taken into consideration. Returns would be less if those were included.

Bottom Line

Overall, Invesco SteelPath MLP Income A ( MLPDX ) has a low Zacks Mutual Fund rank, and in conjunction with its comparatively weak performance, average downside risk, and higher fees, Invesco SteelPath MLP Income A ( MLPDX ) looks like a somewhat weak choice for investors right now.

Your research on the Sector - Energy segment doesn't have to stop here. You can check out all the great mutual fund tools we have to offer by going to www.zacks.com/funds/mutual-funds to see the additional features we offer as well for additional information. If you want to check out our stock reports as well, make sure to go to Zacks.com to see all of the great tools we have to offer, including our time-tested Zacks Rank.

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This article originally published on Zacks Investment Research (zacks.com).

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