Is American Beacon London Company Income Equity Y (ABCYX) a Strong Mutual Fund Pick Right Now?

There are plenty of choices in the Large Cap Value category, but where should you start your research? Well, one fund that you should consider investigating is American Beacon London Company Income Equity Y (ABCYX). ABCYX possesses a Zacks Mutual Fund Rank of 3 (Hold), which is based on various forecasting factors like size, cost, and past performance.ObjectiveABCYX is classified in the Large Cap Value segment by Zacks, which is an area full of possibilities. Investors interested in a stable income stream fund these mutual funds very appealing because they have a unique investing strategy. Large Cap Value funds invest in stocks with a market capitalization of $10 billion or more, but whose share prices do not reflect their intrinsic value. This tactic often leads to low P/E ratios and high dividend yields; however, these funds'high growth opportunity are often slowed, as large-cap securities are generally in stable industries with low to moderate growth prospects.History of Fund/ManagerAmerican Beacon is based in Irving, TX, and is the manager of ABCYX. American Beacon London Company Income Equity Y debuted in May of 2012. Since then, ABCYX has accumulated assets of about $678.05 million, according to the most recently available information. A team of investment professionals is the fund's current manager.PerformanceOf course, investors look for strong performance in funds. This fund in particular has delivered a 5-year annualized total return of 11.27%, and is 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 6.05%, 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. Compared to the category average of 14.51%, the standard deviation of ABCYX over the past three years is 15.35%. Looking at the past 5 years, the fund's standard deviation is 16.34% compared to the category average of 15.91%. This makes the fund more volatile than its peers over the past half-decade.Risk FactorsWith a 5-year beta of 0.86, the fund is likely to be less volatile than the market average. Because alpha represents a portfolio's performance on a risk-adjusted basis relative to a benchmark, which is the S&P 500 in this case, one should pay attention to this metric as well. ABCYX's 5-year performance has produced a negative alpha of -3.07, which means managers in this portfolio find it difficult to pick securities that generate better-than-benchmark returns.ExpensesFor investors, taking a closer look at cost-related metrics is key, since costs are increasingly important for mutual fund investing. Competition is heating up in this space, and a lower cost product will likely outperform its otherwise identical counterpart, all things being equal. In terms of fees, ABCYX is a no load fund. It has an expense ratio of 0.81% compared to the category average of 0.95%. So, ABCYX is actually cheaper than its peers from a cost perspective.Investors need to be aware that with this product, the minimum initial investment is $100,000; each subsequent investment needs to be at least $50.Fees charged by investment advisors have not been taken into considiration. Returns would be less if those were included.Bottom LineOverall, even with its comparatively weak performance, average downside risk, and lower fees, American Beacon London Company Income Equity Y ( ABCYX ) has a neutral Zacks Mutual Fund rank, and therefore looks a somewhat average choice for investors right now.For additional information on this product, or to compare it to other mutual funds in the Large Cap Value, make sure to go to www.zacks.com/funds/mutual-funds for additional information. 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