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Is T. Rowe Price Dividend Growth (PRDGX) a Strong Mutual Fund Pick Right Now?
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There are plenty of choices in the Mutual Fund Equity Report category, but where should you start your research? Well, one fund that might be worth investigating is T. Rowe Price Dividend Growth (PRDGX - Free Report) . PRDGX bears a Zacks Mutual Fund Rank of 1 (Strong Buy), which is based on nine forecasting factors like size, cost, and past performance.
History of Fund/Manager
T. Rowe Price is based in Baltimore, MD, and is the manager of PRDGX. Since T. Rowe Price Dividend Growth made its debut in December of 1992, PRDGX has garnered more than $14.63 billion in assets. Thomas J. Huber is the fund's current manager and has held that role since March of 2000.
Performance
Investors naturally seek funds with strong performance. This fund in particular has delivered a 5-year annualized total return of 12.77%, and is in the top 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 12.1%, 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. The standard deviation of PRDGX over the past three years is 17.1% compared to the category average of 16.51%. Looking at the past 5 years, the fund's standard deviation is 15.2% compared to the category average of 14.86%. This makes the fund more volatile than its peers over the past half-decade.
Risk Factors
Investors should not forget about beta, an important way to measure a mutual fund's risk compared to the market as a whole. PRDGX has a 5-year beta of 0.85, which means it 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. The fund has produced a positive alpha over the past 5 years of 1.47, which shows that managers in this portfolio are skilled in picking securities that generate better-than-benchmark returns.
Holdings
Exploring the equity holdings of a mutual fund is also a valuable exercise. This can show us how the manager is applying their stated methodology, as well as if there are any inherent biases in their approach. For this particular fund, the focus is principally on equities that are traded in the United States.
This fund is currently holding about 87.76% stock in stocks, with an average market capitalization of $290.73 billion. The fund has the heaviest exposure to the following market sectors:
Technology
Finance
Industrial Cyclical
Non-Durable
This fund's turnover is about 12.3%, so the fund managers are making fewer trades than the average comparable fund.
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, PRDGX is a no load fund. It has an expense ratio of 0.62% compared to the category average of 0.92%. From a cost perspective, PRDGX is actually cheaper than its peers.
Investors need to be aware that with this product, the minimum initial investment is $2,500; each subsequent investment needs to be at least $100.
Bottom Line
Overall, T. Rowe Price Dividend Growth ( PRDGX ) has a high Zacks Mutual Fund rank, and in conjunction with its comparatively strong performance, average downside risk, and lower fees, T. Rowe Price Dividend Growth ( PRDGX ) looks like a good potential choice for investors right now.
Don't stop here for your research on Mutual Fund Equity Report funds. We also have plenty more on our site in order to help you find the best possible fund for your portfolio. Make sure to check out www.zacks.com/funds/mutual-funds for more information about the world of funds, and feel free to compare PRDGX to its peers as well for additional information. Want to learn even more? We have a full suite of tools on stocks that you can use to find the best choices for your portfolio too, no matter what kind of investor you are.
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Is T. Rowe Price Dividend Growth (PRDGX) a Strong Mutual Fund Pick Right Now?
There are plenty of choices in the Mutual Fund Equity Report category, but where should you start your research? Well, one fund that might be worth investigating is T. Rowe Price Dividend Growth (PRDGX - Free Report) . PRDGX bears a Zacks Mutual Fund Rank of 1 (Strong Buy), which is based on nine forecasting factors like size, cost, and past performance.
History of Fund/Manager
T. Rowe Price is based in Baltimore, MD, and is the manager of PRDGX. Since T. Rowe Price Dividend Growth made its debut in December of 1992, PRDGX has garnered more than $14.63 billion in assets. Thomas J. Huber is the fund's current manager and has held that role since March of 2000.
Performance
Investors naturally seek funds with strong performance. This fund in particular has delivered a 5-year annualized total return of 12.77%, and is in the top 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 12.1%, 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. The standard deviation of PRDGX over the past three years is 17.1% compared to the category average of 16.51%. Looking at the past 5 years, the fund's standard deviation is 15.2% compared to the category average of 14.86%. This makes the fund more volatile than its peers over the past half-decade.
Risk Factors
Investors should not forget about beta, an important way to measure a mutual fund's risk compared to the market as a whole. PRDGX has a 5-year beta of 0.85, which means it 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. The fund has produced a positive alpha over the past 5 years of 1.47, which shows that managers in this portfolio are skilled in picking securities that generate better-than-benchmark returns.
Holdings
Exploring the equity holdings of a mutual fund is also a valuable exercise. This can show us how the manager is applying their stated methodology, as well as if there are any inherent biases in their approach. For this particular fund, the focus is principally on equities that are traded in the United States.
This fund is currently holding about 87.76% stock in stocks, with an average market capitalization of $290.73 billion. The fund has the heaviest exposure to the following market sectors:
- Technology
- Finance
- Industrial Cyclical
- Non-Durable
This fund's turnover is about 12.3%, so the fund managers are making fewer trades than the average comparable fund.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, PRDGX is a no load fund. It has an expense ratio of 0.62% compared to the category average of 0.92%. From a cost perspective, PRDGX is actually cheaper than its peers.
Investors need to be aware that with this product, the minimum initial investment is $2,500; each subsequent investment needs to be at least $100.
Bottom Line
Overall, T. Rowe Price Dividend Growth ( PRDGX ) has a high Zacks Mutual Fund rank, and in conjunction with its comparatively strong performance, average downside risk, and lower fees, T. Rowe Price Dividend Growth ( PRDGX ) looks like a good potential choice for investors right now.
Don't stop here for your research on Mutual Fund Equity Report funds. We also have plenty more on our site in order to help you find the best possible fund for your portfolio. Make sure to check out www.zacks.com/funds/mutual-funds for more information about the world of funds, and feel free to compare PRDGX to its peers as well for additional information. Want to learn even more? We have a full suite of tools on stocks that you can use to find the best choices for your portfolio too, no matter what kind of investor you are.