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Is T. Rowe Price Real Estate (TRREX) a Strong Mutual Fund Pick Right Now?
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Any investors hoping to find a Sector - Real Estate fund could think about starting with T. Rowe Price Real Estate (TRREX - Free Report) . TRREX possesses a Zacks Mutual Fund Rank of 3 (Hold), which is based on nine forecasting factors like size, cost, and past performance.
Objective
We classify TRREX in the Sector - Real Estate category, an area full of possible choices. Sector - Real Estate mutual funds typically invest in various real estate investment trusts (REIT). A REIT is a popular income vehicle thanks to taxation rules that require REITs to payout at least 90% of their income each year in order to avoid double taxation. This technique makes securities here high dividend payers, and almost bond like in some cases; however, they still carry the risk of equities.
History of Fund/Manager
T. Rowe Price is responsible for TRREX, and the company is based out of Baltimore, MD. The T. Rowe Price Real Estate made its debut in February of 1998 and TRREX has managed to accumulate roughly $1.11 billion in assets, as of the most recently available information. The fund's current manager, Nina Jones, has been in charge of the fund since January of 2019.
Performance
Of course, investors look for strong performance in funds. This fund in particular has delivered a 5-year annualized total return of 2.86%, and it sits in the middle 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 5.33%, which places it in the middle third during this time-frame.
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. Over the past three years, TRREX's standard deviation comes in at 19.82%, compared to the category average of 15.98%. The standard deviation of the fund over the past 5 years is 16.75% compared to the category average of 13.74%. This makes the fund more volatile than its peers over the past half-decade.
Risk Factors
Investors should note that the fund has a 5-year beta of 0.85, so it is likely going to be less volatile than the market at large. Another factor to consider is alpha, as it reflects a portfolio's performance on a risk-adjusted basis relative to a benchmark-in this case, the S&P 500. The fund has produced a negative alpha over the past 5 years of -9.37, which shows that managers in this portfolio find it difficult to pick securities that generate better-than-benchmark returns.
Expenses
Costs are increasingly important for mutual fund investing, and particularly as competition heats up in this market. And all things being equal, a lower cost product will outperform its otherwise identical counterpart, so taking a closer look at these metrics is key for investors. In terms of fees, TRREX is a no load fund. It has an expense ratio of 0.78% compared to the category average of 1.22%. Looking at the fund from a cost perspective, TRREX is actually cheaper than its peers.
Investors should also note that the minimum initial investment for the product is $2,500 and that each subsequent investment needs to be at $100.
Bottom Line
Overall, T. Rowe Price Real Estate ( TRREX ) has a neutral Zacks Mutual Fund rank, and in conjunction with its comparatively similar performance, average downside risk, and lower fees, this fund looks like a somewhat average choice for investors right now.
Your research on the Sector - Real Estate segment doesn't have to stop here. You can check out all the great mutual fund tools we have to offer by going to www.zacks.com/funds/mutual-funds to see the additional features we offer as well for additional information. If you want to check out our stock reports as well, make sure to go to Zacks.com to see all of the great tools we have to offer, including our time-tested Zacks Rank.
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Is T. Rowe Price Real Estate (TRREX) a Strong Mutual Fund Pick Right Now?
Any investors hoping to find a Sector - Real Estate fund could think about starting with T. Rowe Price Real Estate (TRREX - Free Report) . TRREX possesses a Zacks Mutual Fund Rank of 3 (Hold), which is based on nine forecasting factors like size, cost, and past performance.
Objective
We classify TRREX in the Sector - Real Estate category, an area full of possible choices. Sector - Real Estate mutual funds typically invest in various real estate investment trusts (REIT). A REIT is a popular income vehicle thanks to taxation rules that require REITs to payout at least 90% of their income each year in order to avoid double taxation. This technique makes securities here high dividend payers, and almost bond like in some cases; however, they still carry the risk of equities.
History of Fund/Manager
T. Rowe Price is responsible for TRREX, and the company is based out of Baltimore, MD. The T. Rowe Price Real Estate made its debut in February of 1998 and TRREX has managed to accumulate roughly $1.11 billion in assets, as of the most recently available information. The fund's current manager, Nina Jones, has been in charge of the fund since January of 2019.
Performance
Of course, investors look for strong performance in funds. This fund in particular has delivered a 5-year annualized total return of 2.86%, and it sits in the middle 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 5.33%, which places it in the middle third during this time-frame.
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. Over the past three years, TRREX's standard deviation comes in at 19.82%, compared to the category average of 15.98%. The standard deviation of the fund over the past 5 years is 16.75% compared to the category average of 13.74%. This makes the fund more volatile than its peers over the past half-decade.
Risk Factors
Investors should note that the fund has a 5-year beta of 0.85, so it is likely going to be less volatile than the market at large. Another factor to consider is alpha, as it reflects a portfolio's performance on a risk-adjusted basis relative to a benchmark-in this case, the S&P 500. The fund has produced a negative alpha over the past 5 years of -9.37, which shows that managers in this portfolio find it difficult to pick securities that generate better-than-benchmark returns.
Expenses
Costs are increasingly important for mutual fund investing, and particularly as competition heats up in this market. And all things being equal, a lower cost product will outperform its otherwise identical counterpart, so taking a closer look at these metrics is key for investors. In terms of fees, TRREX is a no load fund. It has an expense ratio of 0.78% compared to the category average of 1.22%. Looking at the fund from a cost perspective, TRREX is actually cheaper than its peers.
Investors should also note that the minimum initial investment for the product is $2,500 and that each subsequent investment needs to be at $100.
Bottom Line
Overall, T. Rowe Price Real Estate ( TRREX ) has a neutral Zacks Mutual Fund rank, and in conjunction with its comparatively similar performance, average downside risk, and lower fees, this fund looks like a somewhat average choice for investors right now.
Your research on the Sector - Real Estate segment doesn't have to stop here. You can check out all the great mutual fund tools we have to offer by going to www.zacks.com/funds/mutual-funds to see the additional features we offer as well for additional information. If you want to check out our stock reports as well, make sure to go to Zacks.com to see all of the great tools we have to offer, including our time-tested Zacks Rank.