A number that measures the risk-adjusted performance of a fund over a given time period. A positive number means the fund performed better than its benchmark given its volatility or level of risk - the higher the number, the better. A negative number means the fund performed worse than its benchmark given its volatility.
A term coined by Wasatch, ABGC’s are U.S. companies of the highest quality that we believe possess an identifiable, sustainable competitive advantage, are well managed, and have the potential to double in size in five years.
A measure of the volatility of a fund’s performance relative to the overall market’s performance over a given time period. A beta above 1 means the fund was more volatile than the overall market. A beta of less than 1 indicates that the fund was less volatile than the overall market.
One of the ways a mutual fund realizes profits. Capital gain is when a fund sells its stock holdings for a more than the purchase price. A short term capital gain reflects profits on investments that were held in the fund for less than a year. A long term capital gain reflects profits on investments held in the fund for longer than a year. Tax rates are usually lower for long term capital gains than short term gains. See also .
The purchase price of a mutual fund that includes commissions and other related shareholder expenses. Cost basis is used to determine capital gains and losses for tax purposes.
When a mutual fund realizes profits from capitals gains, dividends, or interest, the IRS requires the fund to distribute these profits to shareholders at least annually. The payment of this dividend or capital gain is called a “distribution” to the shareholder.
One of the ways a mutual fund realizes profits. A dividend is a payment a company makes to the fund as a shareholder. Companies don’t always pay dividends; they most typically do when they have progressed beyond the growth phase and won’t sufficiently benefit by reinvesting their profits back into the business. See also .
The measure of how much a company’s net income has grown over a certain period of time. Earnings growth can reflect actual growth in the past, or it may be an estimate of future growth using analyst projections.
The expense ratio indicates how much it costs to operate a fund, and how much a shareholder pays for owning that fund. It is equal to a fund’s operating costs (including management fees) divided by the fund’s net assets (averaged over a certain period of time). The expense ratio does not include brokerage or transaction costs that may affect the total expenses of a shareholder.
We consider foreign companies to be those domiciled outside of the United States. When determining domicile, we may consider factors such as a company's country of incorporation, primary exchange, geographic location of assets, and geographic sources of revenue.
The forward P/E ratio is a measure of a stock’s valuation. The forward P/E ratio is an indication of how much investors are willing to pay for the opportunity to share in the company’s future earnings potential. The forward P/E equals a company’s stock price divided by its projected earnings per share (specifically projected after tax earnings for the next 12 months). Since the fund has many holdings, its forward PE ratio is the weighted average of all the forward P/E ratios of its underlying holdings.
Holdings are the companies owned or held in a mutual fund’s portfolio. The number of holdings in a fund is likely to change frequently due to on-going management of the fund.
The ratio of the portfolio’s expected return compared to risk. This is a statistical way to measure a portfolio manager’s performance against a benchmark.
In general, companies that have a market capitalization (market cap) of more than $20 billion.
A percentage that measures the year-over-year change of a fund’s value. Long-term growth is generally measured over 10 years or more.
The market cap is the value of a company—theoretically, what it could be sold for on a given day. This amount is determined by the market price of its common stock. Market cap is calculated by multiplying the number of outstanding shares by the current market price of a share.
This is the market cap of a company that is exactly halfway between the two companies with the highest and the lowest market caps in the portfolio.
In general, companies that have less than a $1 billion market capitalization.
In general, companies that have a $3 to $20 billion market capitalization.
A fund’s Net Asset Value, or NAV, is the value of one share at the end of a business day. This is the price at which you would either buy or sell shares of a fund. It is equal to a fund’s assets minus its liabilities, divided by the number of shares outstanding. NAVs are calculated at 4:00 p.m. ET each day for most U.S. mutual funds.
A “no-load fund” is a fund that does not require a sales charge and does not give a commission to the broker for purchasing the fund. No-load funds are typically purchased directly from the fund company or through a mutual fund supermarket. One of the benefits of a no-load fund is that shareholders pay lower fees than if they purchased a load fund. All Wasatch Funds are no-load funds.
The P/E ratio is the most common measure of a stock’s valuation. It is also sometimes called the "earnings multiple." The value of the P/E ratio is an indicator of how much investors are willing to pay for the opportunity to share in the company’s future earnings potential. P/E equals a company’s stock price divided by its earnings per share(specifically, after-tax earnings during the most recent 12-month period). Since a fund has many holdings, its P/E ratio is the weighted average of all the P/E ratios of its underlying holdings.
The record date is the date at which Wasatch Funds takes a “snapshot” to see who holds shares in a particular fund before a distribution. You must own shares by the record date in order to be eligible to receive a declared dividend or capital gain distribution.
Return on assets (ROA) measures a company’s profitability by showing how many dollars of earnings a company derives from each dollar of assets it controls.
In general, companies that have a $1 to $3 billion market capitalization.
The standard deviation measure the volatility of a portfolio over a given time period. With regard to performance, this number shows how much a fund’s total returns are spread around the portfolio’s average total return.
Portfolio turnover rate measures the buying and selling activity in a fund during the past 12 months. It is computed by dividing total purchases or sales, whichever is less, by the average monthly market value of the fund’s portfolio securities.
The process of determining the worth or value of a company. Wasatch Funds practices deep due diligence in researching the valuation of companies for our portfolios. Learn more about our research process
The weighted average market cap is the average market capitalization of all companies in a fund—with each company weighted according to its percent held in the fund. (The more shares we own of a company, the greater its weight on the weighted average market cap of the fund.)
A term coined by Wasatch Funds, these are what we believe to be the highest quality companies in or outside the United States that possess an identifiable, sustainable competitive advantage, are well managed, and are producing above-average earnings growth relative to industry/country of origin.