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Is T. Rowe Price Institutional Mid-Cap Equity Growth (PMEGX) a Strong Mutual Fund Pick Right Now?
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If you have been looking for Mid Cap Growth funds, a place to start could be T. Rowe Price Institutional Mid-Cap Equity Growth (PMEGX - Free Report) . PMEGX 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 PMEGX is a Mid Cap Growth fund, and this area is also loaded with many different options. Companies are usually considered growth stocks when they consistently report notable sales and/or earnings growth. Thus, Mid Cap Growth funds pick stocks--usually companies with a market cap between $2 billion and $10 billion--that demonstrate extensive growth opportunities for investors compared to their peers.
History of Fund/Manager
T. Rowe Price is based in Baltimore, MD, and is the manager of PMEGX. T. Rowe Price Institutional Mid-Cap Equity Growth made its debut in July of 1996, and since then, PMEGX has accumulated about $8.12 billion in assets, per the most up-to-date date available. The fund's current manager, Brian W. H. Berghuis, has been in charge of the fund since July of 1996.
Performance
Investors naturally seek funds with strong performance. PMEGX has a 5-year annualized total return of 5.92% and is in the top 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 4.7%, 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. PMEGX's standard deviation over the past three years is 17.5% compared to the category average of 15.15%. Over the past 5 years, the standard deviation of the fund is 15.56% compared to the category average of 14.34%. This makes the fund more volatile than its peers over the past half-decade.
Risk Factors
Investors should always remember the downsides to a potential investment, and this segment carries some risks one should be aware of. In the most recent bear market, PMEGX lost 49.22% and outperformed its peer group by 3%. This means that the fund could possibly be a better choice than its peers during a down market environment.
Even still, the fund has a 5-year beta of 1.09, so investors should note that it is hypothetically more 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. With a negative alpha of -1, managers in this portfolio find it difficult to pick securities that generate better-than-benchmark returns.
Expenses
As competition heats up in the mutual fund market, costs become increasingly important. Compared to its otherwise identical counterpart, a low-cost product will be an outperformer, all other things being equal. Thus, taking a closer look at cost-related metrics is vital for investors. In terms of fees, PMEGX is a no load fund. It has an expense ratio of 0.61% compared to the category average of 1.20%. From a cost perspective, PMEGX is actually cheaper than its peers.
Investors should also note that the minimum initial investment for the product is $1 million and that each subsequent investment has no minimum amount.
Bottom Line
Overall, T. Rowe Price Institutional Mid-Cap Equity Growth ( PMEGX ) 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 Mid-Cap Equity Growth ( PMEGX ) looks like a good potential choice for investors right now.
This could just be the start of your research on PMEGXin the Mid Cap Growth category. Consider going to www.zacks.com/funds/mutual-funds for additional information about this fund, and all the others that we rank 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 Institutional Mid-Cap Equity Growth (PMEGX) a Strong Mutual Fund Pick Right Now?
If you have been looking for Mid Cap Growth funds, a place to start could be T. Rowe Price Institutional Mid-Cap Equity Growth (PMEGX - Free Report) . PMEGX 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 PMEGX is a Mid Cap Growth fund, and this area is also loaded with many different options. Companies are usually considered growth stocks when they consistently report notable sales and/or earnings growth. Thus, Mid Cap Growth funds pick stocks--usually companies with a market cap between $2 billion and $10 billion--that demonstrate extensive growth opportunities for investors compared to their peers.
History of Fund/Manager
T. Rowe Price is based in Baltimore, MD, and is the manager of PMEGX. T. Rowe Price Institutional Mid-Cap Equity Growth made its debut in July of 1996, and since then, PMEGX has accumulated about $8.12 billion in assets, per the most up-to-date date available. The fund's current manager, Brian W. H. Berghuis, has been in charge of the fund since July of 1996.
Performance
Investors naturally seek funds with strong performance. PMEGX has a 5-year annualized total return of 5.92% and is in the top 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 4.7%, 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. PMEGX's standard deviation over the past three years is 17.5% compared to the category average of 15.15%. Over the past 5 years, the standard deviation of the fund is 15.56% compared to the category average of 14.34%. This makes the fund more volatile than its peers over the past half-decade.
Risk Factors
Investors should always remember the downsides to a potential investment, and this segment carries some risks one should be aware of. In the most recent bear market, PMEGX lost 49.22% and outperformed its peer group by 3%. This means that the fund could possibly be a better choice than its peers during a down market environment.
Even still, the fund has a 5-year beta of 1.09, so investors should note that it is hypothetically more 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. With a negative alpha of -1, managers in this portfolio find it difficult to pick securities that generate better-than-benchmark returns.
Expenses
As competition heats up in the mutual fund market, costs become increasingly important. Compared to its otherwise identical counterpart, a low-cost product will be an outperformer, all other things being equal. Thus, taking a closer look at cost-related metrics is vital for investors. In terms of fees, PMEGX is a no load fund. It has an expense ratio of 0.61% compared to the category average of 1.20%. From a cost perspective, PMEGX is actually cheaper than its peers.
Investors should also note that the minimum initial investment for the product is $1 million and that each subsequent investment has no minimum amount.
Bottom Line
Overall, T. Rowe Price Institutional Mid-Cap Equity Growth ( PMEGX ) 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 Mid-Cap Equity Growth ( PMEGX ) looks like a good potential choice for investors right now.
This could just be the start of your research on PMEGXin the Mid Cap Growth category. Consider going to www.zacks.com/funds/mutual-funds for additional information about this fund, and all the others that we rank 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.