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May 05, 2004 at 08:00 PM
April 29, 2004 — For investors looking for an all-in-one equity fund, SunAmerica Mutual Funds is offering SunAmerica Focused Equity Strategy/A (FESAX), a ‘fund of funds’ investing in domestic and international equity portfolios.
The product is suitable for “a relatively uninitiated” investor, or an intermediary looking for asset allocation assistance, says Steve Schoepke, a vice president of research and product development at SunAmerica. Schoepke oversees asset allocation and subadvisor selection for Focused Equity Strategy.
With Focused Equity Strategy, SunAmerica takes the concept of a fund of funds a step further since each underlying portfolio is run by three different outside subadvisors. These include Janus Capital, Dreman Value Management, Marsico Capital Management, and Wellington Management, among others.
Launched in November 2002, the $426.8-million offering has made a solid debut. For the one-year period through March, the portfolio gained 43.5%, while the S&P 500-stock index rose 35.1%. To date, the portfolio shows moderate volatility relative to the broad market based on one-year standard deviation. Focus Equity Strategy is too new to be ranked by Standard & Poor’s.
Typical of a fund of funds, overall expenses for the SunAmerica offering are higher than those for the average domestic equity fund. The fund’s Class A shares carry a 1.94% combined annual expense ratio, which includes a 0.61% fee for asset allocation. In contrast, the average large-cap blend fund carries a 1.14% expense ratio.
