Is Oppenheimer Discovery Y (ODIYX) a Strong Mutual Fund Pick Right Now?

If you have been looking for Small Cap Growth funds, a place to start could be Oppenheimer Discovery Y (ODIYX). ODIYX possesses a Zacks Mutual Fund Rank of 1 (Strong Buy), which is based on various forecasting factors like size, cost, and past performance.ObjectiveODIYX is part of the Small Cap Growth category, and this segment boasts an array of many other possible options. Small Cap Growth mutual funds usually focus their portfolios on stocks with large growth opportunities and a market cap of under $2 billion. These portfolios tend to feature small companies in up-and-coming industries and markets.History of Fund/ManagerODIYX is a part of the Invesco family of funds, a company based out of Kansas City, MO. Since Oppenheimer Discovery Y made its debut in June of 1994, ODIYX has garnered more than $1.87 billion in assets. The fund is currently managed by Ronald J. Zibelli Jr. who has been in charge of the fund since May of 2006.PerformanceOf course, investors look for strong performance in funds. ODIYX has a 5-year annualized total return of 11.59% and it sits in the top third among its category peers. But if you are looking for a shorter time frame, it is also worth looking at its 3-year annualized total return of -0.24%, which places it in the middle 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. The standard deviation of ODIYX over the past three years is 23.6% compared to the category average of 15.82%. The fund's standard deviation over the past 5 years is 23.46% compared to the category average of 16.85%. This makes the fund more volatile than its peers over the past half-decade.Risk FactorsInvestors should not forget about beta, an important way to measure a mutual fund's risk compared to the market as a whole. ODIYX has a 5-year beta of 1.11, which means it is likely to be more 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. ODIYX has generated a negative alpha over the past five years of -2.94, demonstrating that managers in this portfolio find it difficult to pick securities that generate better-than-benchmark returns.ExpensesAs competition heats up in the mutual fund market, costs become increasingly important. Compared to its otherwise identical counterpart, a low-cost product will be an outperformer, all other things being equal. Thus, taking a closer look at cost-related metrics is vital for investors. In terms of fees, ODIYX is a no load fund. It has an expense ratio of 0.80% compared to the category average of 0.99%. From a cost perspective, ODIYX is actually cheaper than its peers.Investors need to be aware that with this product, the minimum initial investment is $1,000; 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, Oppenheimer Discovery Y ( ODIYX ) has a high Zacks Mutual Fund rank, and in conjunction with its comparatively strong performance, worse downside risk, and lower fees, Oppenheimer Discovery Y ( ODIYX ) looks like a good potential choice for investors right now.This could just be the start of your research on ODIYXin the Small Cap Growth category. Consider going to www.zacks.com/funds/mutual-funds for additional information about this fund, and all the others that we rank as well for additional information. Zacks provides a full suite of tools to help you analyze your portfolio - both funds and stocks - in the most efficient way possible.Free Today: Profiting from The Future’s Brightest Energy SourceThe demand for electricity is growing exponentially. At the same time, we’re working to reduce our dependence on fossil fuels like oil and natural gas. 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