How To Profit From The ‘Best Of Both Worlds’ In Stock Investing: (AFOIX)

Ted

FYI: After a 10-year rally for large-cap stocks, a way to diversify your investments and reduce short-term risk is to increase exposure to mid-cap shares.

We recently discussed the long-term outperformance of value stocks and equally weighted index funds — two areas to consider if you wish to cut risk by diversifying beyond the market-capitalization-weighted S&P 500 Index SPX, -0.49%. (The S&P 500 isn’t as diversified as its name implies because the index’s five largest companies — Microsoft MSFT, -1.16%, Apple AAPL, -1.46%, Amazon AMZN, -1.50%, Alphabet GOOG, -0.71% GOOGL, -0.72% and Facebook FB, -0.11% — make up 17% of the market value.)

Leaving cap-weighting aside, mid-cap stocks are often overlooked, despite good performance characteristics.

Amy Zhang, who manages the Alger Small Cap Focus Fund AOFAX, -0.05% (which has had an incredible performance run) launched the Alger Mid-Cap Focus Fund AFOIX, -0.40% in June. In an interview at her office in New York, she said mid-cap stocks offered “the best of both worlds,” with quality “close to large-cap” stocks, while the group’s growth “is closer to small-cap.”

She also discussed, below, three of the companies held by the Alger Mid-Cap Focus Fund.
Regards,
Ted
https://www.marketwatch.com/story/how-to-profit-from-the-best-of-both-worlds-in-stock-investing-2019-09-20/print

Alger Website:
https://www.alger.com/Pages/Products.aspx?productCode=5040

Old_Skeet

Old_Skeet owns AOFAX which has some mid caps in it and is listed by M* as a mid cap growth fund rather than a small cap fund; plus, I also own KAUAX which is listed as a mid cap growth fund by M* but touches most of the style boxes. They are both good funds from my perspective. With this, I will probably pass on opening a position in AFOIX and keep on keeping on with KAUAX.

BenWP

I just wasted a lot of time thanks to M*'s dropping of the "Purchase" tab for researching MFs. Going to both Schwab and TDA I found that AFOIX is available only to institutional investors at the former and not at all at the latter. My surfing to Alger finally got me the the symbol AFOZX, which is the share class for mere mortals. This mortal was interested in the fund, in part due to reading the MarketWatch piece on mid-caps linked above. Zhang spent 14 years in small and mid caps at Brown Capital before Alger hired her away in 2015. I can't think of a better place to train. Her Alger small-mid fund has been great. In any event, AFOZX is currently available NL but with the transaction fee at the two above brokerages, a deterrent for me. Maybe the fund will become NTF if it grows.