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Is T. Rowe Price Balanced Fund (RPBAX) a Strong Mutual Fund Pick Right Now?
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Any investors hoping to find an Allocation Balanced fund could think about starting with T. Rowe Price Balanced Fund (RPBAX - Free Report) . RPBAX bears a Zacks Mutual Fund Rank of 1 (Strong Buy), which is based on nine forecasting factors like size, cost, and past performance.
Objective
RPBAX is classified in the Allocation Balanced segment by Zacks, which is an area full of possibilities. Here, investors are able to get a good head start with diversified mutual funds, and play around with core holding options for a portfolio of funds. Allocation Balanced funds look to invest across a balance of asset types, like stocks, bonds, and cash, though including precious metals or commodities is not unusual; these funds are mostly categorized by their respective asset allocation.
History of Fund/Manager
T. Rowe Price is based in Baltimore, MD, and is the manager of RPBAX. Since T. Rowe Price Balanced Fund made its debut in December of 1939, RPBAX has garnered more than $4.09 billion in assets. The fund's current manager, Charles Shriver, has been in charge of the fund since May of 2011.
Performance
Obviously, what investors are looking for in these funds is strong performance relative to their peers. This fund in particular has delivered a 5-year annualized total return of 11.04%, and it sits 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 10.72%, 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 RPBAX over the past three years is 12.57% compared to the category average of 13.84%. The standard deviation of the fund over the past 5 years is 10.15% compared to the category average of 11.38%. This makes the fund less 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. RPBAX has a 5-year beta of 0.66, 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. RPBAX has generated a negative alpha over the past five years of -0.05, demonstrating 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, RPBAX is a no load fund. It has an expense ratio of 0.55% compared to the category average of 0.89%. RPBAX is actually cheaper than its peers when you consider factors like cost.
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 Balanced Fund ( RPBAX ) has a high Zacks Mutual Fund rank, and in conjunction with its comparatively strong performance, average downside risk, and lower fees, this fund looks like a good potential choice for investors right now.
Don't stop here for your research on Allocation Balanced 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 RPBAX to its peers 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 Balanced Fund (RPBAX) a Strong Mutual Fund Pick Right Now?
Any investors hoping to find an Allocation Balanced fund could think about starting with T. Rowe Price Balanced Fund (RPBAX - Free Report) . RPBAX bears a Zacks Mutual Fund Rank of 1 (Strong Buy), which is based on nine forecasting factors like size, cost, and past performance.
Objective
RPBAX is classified in the Allocation Balanced segment by Zacks, which is an area full of possibilities. Here, investors are able to get a good head start with diversified mutual funds, and play around with core holding options for a portfolio of funds. Allocation Balanced funds look to invest across a balance of asset types, like stocks, bonds, and cash, though including precious metals or commodities is not unusual; these funds are mostly categorized by their respective asset allocation.
History of Fund/Manager
T. Rowe Price is based in Baltimore, MD, and is the manager of RPBAX. Since T. Rowe Price Balanced Fund made its debut in December of 1939, RPBAX has garnered more than $4.09 billion in assets. The fund's current manager, Charles Shriver, has been in charge of the fund since May of 2011.
Performance
Obviously, what investors are looking for in these funds is strong performance relative to their peers. This fund in particular has delivered a 5-year annualized total return of 11.04%, and it sits 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 10.72%, 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 RPBAX over the past three years is 12.57% compared to the category average of 13.84%. The standard deviation of the fund over the past 5 years is 10.15% compared to the category average of 11.38%. This makes the fund less 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. RPBAX has a 5-year beta of 0.66, 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. RPBAX has generated a negative alpha over the past five years of -0.05, demonstrating 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, RPBAX is a no load fund. It has an expense ratio of 0.55% compared to the category average of 0.89%. RPBAX is actually cheaper than its peers when you consider factors like cost.
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 Balanced Fund ( RPBAX ) has a high Zacks Mutual Fund rank, and in conjunction with its comparatively strong performance, average downside risk, and lower fees, this fund looks like a good potential choice for investors right now.
Don't stop here for your research on Allocation Balanced 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 RPBAX to its peers 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.