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Is T. Rowe Price Media & Telecomm (PRMTX) a Strong Mutual Fund Pick Right Now?
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If investors are looking at the Sector - Tech fund category, T. Rowe Price Media & Telecomm (PRMTX - Free Report) could be a potential option. PRMTX possesses a Zacks Mutual Fund Rank of 1 (Strong Buy), which is based on nine forecasting factors like size, cost, and past performance.
Objective
We note that PRMTX is a Sector - Tech option, and this area is loaded with many options. Found in a wide number of industries such as semiconductors, software, internet, and networking, tech companies are everywhere. Thus, Sector - Tech mutual funds that invest in technology let investors own a stake in a notoriously volatile sector, but with a much more diversifies approach.
History of Fund/Manager
T. Rowe Price is based in Baltimore, MD, and is the manager of PRMTX. T. Rowe Price Media & Telecomm made its debut in July of 1997, and since then, PRMTX has accumulated about $5.05 billion in assets, per the most up-to-date date available. Paul D. Greene is the fund's current manager and has held that role since May of 2013.
Performance
Investors naturally seek funds with strong performance. This fund has delivered a 5-year annualized total return of 13.44%, and is in the top third among its category peers. Investors who prefer analyzing shorter time frames should look at its 3-year annualized total return of 18.7%, 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. PRMTX's standard deviation over the past three years is 14.26% compared to the category average of 12.68%. Over the past 5 years, the standard deviation of the fund is 14.69% compared to the category average of 12.45%. This makes the fund more volatile than its peers over the past half-decade.
Risk Factors
One cannot ignore the volatility of this segment, however, as it is always important for investors to remember the downside to any potential investment. In the most recent bear market, PRMTX lost 53.95% and underperformed its peer group by 0.64%. This makes the fund a possibly worse choice than its peers during a sliding market environment.
Even still, the fund has a 5-year beta of 1.11, so investors should note that it is hypothetically more volatile than the market at large. 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. With a positive alpha of 1.58, managers in this portfolio are skilled in picking 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, PRMTX is a no load fund. It has an expense ratio of 0.78% compared to the category average of 1.31%. Looking at the fund from a cost perspective, PRMTX 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 Media & Telecomm ( PRMTX ) has a high Zacks Mutual Fund rank, strong performance, average downside risk, and lower fees compared to its peers.
For additional information on the Sector - Tech area of the mutual fund world, make sure to check out www.zacks.com/funds/mutual-funds. There, you can see more about the ranking process, and dive even deeper into PRMTX too 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 Media & Telecomm (PRMTX) a Strong Mutual Fund Pick Right Now?
If investors are looking at the Sector - Tech fund category, T. Rowe Price Media & Telecomm (PRMTX - Free Report) could be a potential option. PRMTX possesses a Zacks Mutual Fund Rank of 1 (Strong Buy), which is based on nine forecasting factors like size, cost, and past performance.
Objective
We note that PRMTX is a Sector - Tech option, and this area is loaded with many options. Found in a wide number of industries such as semiconductors, software, internet, and networking, tech companies are everywhere. Thus, Sector - Tech mutual funds that invest in technology let investors own a stake in a notoriously volatile sector, but with a much more diversifies approach.
History of Fund/Manager
T. Rowe Price is based in Baltimore, MD, and is the manager of PRMTX. T. Rowe Price Media & Telecomm made its debut in July of 1997, and since then, PRMTX has accumulated about $5.05 billion in assets, per the most up-to-date date available. Paul D. Greene is the fund's current manager and has held that role since May of 2013.
Performance
Investors naturally seek funds with strong performance. This fund has delivered a 5-year annualized total return of 13.44%, and is in the top third among its category peers. Investors who prefer analyzing shorter time frames should look at its 3-year annualized total return of 18.7%, 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. PRMTX's standard deviation over the past three years is 14.26% compared to the category average of 12.68%. Over the past 5 years, the standard deviation of the fund is 14.69% compared to the category average of 12.45%. This makes the fund more volatile than its peers over the past half-decade.
Risk Factors
One cannot ignore the volatility of this segment, however, as it is always important for investors to remember the downside to any potential investment. In the most recent bear market, PRMTX lost 53.95% and underperformed its peer group by 0.64%. This makes the fund a possibly worse choice than its peers during a sliding market environment.
Even still, the fund has a 5-year beta of 1.11, so investors should note that it is hypothetically more volatile than the market at large. 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. With a positive alpha of 1.58, managers in this portfolio are skilled in picking 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, PRMTX is a no load fund. It has an expense ratio of 0.78% compared to the category average of 1.31%. Looking at the fund from a cost perspective, PRMTX 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 Media & Telecomm ( PRMTX ) has a high Zacks Mutual Fund rank, strong performance, average downside risk, and lower fees compared to its peers.
For additional information on the Sector - Tech area of the mutual fund world, make sure to check out www.zacks.com/funds/mutual-funds. There, you can see more about the ranking process, and dive even deeper into PRMTX too 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.