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Is T. Rowe Price Institutional Small-Cap Stock (TRSSX) a Strong Mutual Fund Pick Right Now?
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Small Cap Blend fund seekers should consider taking a look at T. Rowe Price Institutional Small-Cap Stock (TRSSX - Free Report) . TRSSX carries a Zacks Mutual Fund Rank of 1 (Strong Buy), which is based on nine forecasting factors like size, cost, and past performance.
Objective
We classify TRSSX in the Small Cap Blend category, an area rife with potential choices. Small Cap Blend mutual funds usually target companies with a market capitalization of less than $2 billion. A small-cap blend mutual fund allows investors to diversify their funds among various types of small-cap stocks, which can help reduce the volatility inherent in lower market cap companies.
History of Fund/Manager
TRSSX is a part of the T. Rowe Price family of funds, a company based out of Baltimore, MD. The T. Rowe Price Institutional Small-Cap Stock made its debut in October of 2000 and TRSSX has managed to accumulate roughly $5.35 billion in assets, as of the most recently available information. The fund is currently managed by Frank M. Alonso who has been in charge of the fund since October of 2016.
Performance
Obviously, what investors are looking for in these funds is strong performance relative to their peers. TRSSX has a 5-year annualized total return of 11.07% 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 16.56%, which places it in the top 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. Compared to the category average of 17.17%, the standard deviation of TRSSX over the past three years is 14.51%. Looking at the past 5 years, the fund's standard deviation is 14.12% compared to the category average of 16.11%. This makes the fund less 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. TRSSX lost 49.12% in the most recent bear market and outperformed its peer group by 4%. This means that the fund could possibly be a better choice than its peers during a down market environment.
Investors should note that the fund has a 5-year beta of 1.02, so it is likely going to be as volatile as 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. Over the past 5 years, the fund has a positive alpha of 0.35. This means that managers in this portfolio are skilled in picking securities that generate better-than-benchmark returns.
Holdings
Examining 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.
The mutual fund currently has 83.13% of its holdings in stocks, with an average market capitalization of $4.75 billion. The fund has the heaviest exposure to the following market sectors:
Finance
Other
Technology
Industrial Cyclical
Health
Turnover is 32.4%, which means, on average, the fund makes fewer trades than its comparable peers.
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, TRSSX is a no load fund. It has an expense ratio of 0.66% compared to the category average of 1.11%. TRSSX is actually cheaper than its peers when you consider factors like cost.
While the minimum initial investment for the product is $1 million, investors should also note that there is no minimum for each subsequent investment.
Bottom Line
Overall, T. Rowe Price Institutional Small-Cap Stock ( TRSSX ) has a high Zacks Mutual Fund rank, and in conjunction with its comparatively strong performance, average downside risk, and lower fees, T. Rowe Price Institutional Small-Cap Stock ( TRSSX ) looks like a good potential choice for investors right now.
Want even more information about TRSSX? Then go over to Zacks.com and check out our mutual fund comparison tool, and all of the other great features that we have to help you with your mutual fund analysis 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 Institutional Small-Cap Stock (TRSSX) a Strong Mutual Fund Pick Right Now?
Small Cap Blend fund seekers should consider taking a look at T. Rowe Price Institutional Small-Cap Stock (TRSSX - Free Report) . TRSSX carries a Zacks Mutual Fund Rank of 1 (Strong Buy), which is based on nine forecasting factors like size, cost, and past performance.
Objective
We classify TRSSX in the Small Cap Blend category, an area rife with potential choices. Small Cap Blend mutual funds usually target companies with a market capitalization of less than $2 billion. A small-cap blend mutual fund allows investors to diversify their funds among various types of small-cap stocks, which can help reduce the volatility inherent in lower market cap companies.
History of Fund/Manager
TRSSX is a part of the T. Rowe Price family of funds, a company based out of Baltimore, MD. The T. Rowe Price Institutional Small-Cap Stock made its debut in October of 2000 and TRSSX has managed to accumulate roughly $5.35 billion in assets, as of the most recently available information. The fund is currently managed by Frank M. Alonso who has been in charge of the fund since October of 2016.
Performance
Obviously, what investors are looking for in these funds is strong performance relative to their peers. TRSSX has a 5-year annualized total return of 11.07% 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 16.56%, which places it in the top 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. Compared to the category average of 17.17%, the standard deviation of TRSSX over the past three years is 14.51%. Looking at the past 5 years, the fund's standard deviation is 14.12% compared to the category average of 16.11%. This makes the fund less 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. TRSSX lost 49.12% in the most recent bear market and outperformed its peer group by 4%. This means that the fund could possibly be a better choice than its peers during a down market environment.
Investors should note that the fund has a 5-year beta of 1.02, so it is likely going to be as volatile as 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. Over the past 5 years, the fund has a positive alpha of 0.35. This means that managers in this portfolio are skilled in picking securities that generate better-than-benchmark returns.
Holdings
Examining 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.
The mutual fund currently has 83.13% of its holdings in stocks, with an average market capitalization of $4.75 billion. The fund has the heaviest exposure to the following market sectors:
- Finance
- Other
- Technology
- Industrial Cyclical
- Health
Turnover is 32.4%, which means, on average, the fund makes fewer trades than its comparable peers.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, TRSSX is a no load fund. It has an expense ratio of 0.66% compared to the category average of 1.11%. TRSSX is actually cheaper than its peers when you consider factors like cost.
While the minimum initial investment for the product is $1 million, investors should also note that there is no minimum for each subsequent investment.
Bottom Line
Overall, T. Rowe Price Institutional Small-Cap Stock ( TRSSX ) has a high Zacks Mutual Fund rank, and in conjunction with its comparatively strong performance, average downside risk, and lower fees, T. Rowe Price Institutional Small-Cap Stock ( TRSSX ) looks like a good potential choice for investors right now.
Want even more information about TRSSX? Then go over to Zacks.com and check out our mutual fund comparison tool, and all of the other great features that we have to help you with your mutual fund analysis 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.