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Diversified Bonds fund seekers should not consider taking a look at T. Rowe Price Global Multi-Sector Bond Investor (PRSNX - Free Report) at this time. PRSNX possesses a Zacks Mutual Fund Rank of 4 (Sell), which is based on nine forecasting factors like size, cost, and past performance.
Objective
PRSNX is one of many Diversified Bonds funds to choose from. Diversified Bonds funds give investors exposure to a variety of fixed income types that span across different issuers, maturities, and credit levels. Usually, these funds will have a good amount of exposure to government debt, in addition to modest holdings in the corporate bond market.
History of Fund/Manager
PRSNX finds itself in the T. Rowe Price family, based out of Baltimore, MD. The T. Rowe Price Global Multi-Sector Bond Investor made its debut in December of 2008 and PRSNX has managed to accumulate roughly $1.07 billion in assets, as of the most recently available information. The fund is currently managed by Kenneth Orchard who has been in charge of the fund since January of 2018.
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 5.46%, 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 6.2%, 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 11.46%, the standard deviation of PRSNX over the past three years is 7.08%. Looking at the past 5 years, the fund's standard deviation is 5.72% compared to the category average of 9.48%. This makes the fund less volatile than its peers over the past half-decade.
This fund has a beta of 0.89, meaning that it is less volatile than a broad market index of fixed income securities. Taking this into account, PRSNX has a positive alpha of 2.58, which measures performance on a risk-adjusted basis.
Ratings
Investors should also consider a bond's rating, which is a grade ( 'AAA' to 'D' ) given to a bond that indicates its credit quality. With this letter scale in mind, PRSNX has 32.73% in medium quality bonds, with ratings of 'A' to 'BBB'. The fund's junk bond component-bonds rated 'BB' or below-is at 30.94%, giving PRSNX an average quality of BBB. This means that it focuses on medium quality securities.
Expenses
For investors, taking a closer look at cost-related metrics is key, since costs are increasingly important for mutual fund investing. Competition is heating up in this space, and a lower cost product will likely outperform its otherwise identical counterpart, all things being equal. In terms of fees, PRSNX is a no load fund. It has an expense ratio of 0.65% compared to the category average of 0.85%. Looking at the fund from a cost perspective, PRSNX 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 Global Multi-Sector Bond Investor ( PRSNX ) has a low Zacks Mutual Fund rank, and in conjunction with its comparatively strong performance, average downside risk, and lower fees, T. Rowe Price Global Multi-Sector Bond Investor ( PRSNX ) looks like a somewhat weak choice for investors right now.
This could just be the start of your research on PRSNXin the Diversified Bonds 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 PRSNX a Strong Bond Fund Right Now?
Diversified Bonds fund seekers should not consider taking a look at T. Rowe Price Global Multi-Sector Bond Investor (PRSNX - Free Report) at this time. PRSNX possesses a Zacks Mutual Fund Rank of 4 (Sell), which is based on nine forecasting factors like size, cost, and past performance.
Objective
PRSNX is one of many Diversified Bonds funds to choose from. Diversified Bonds funds give investors exposure to a variety of fixed income types that span across different issuers, maturities, and credit levels. Usually, these funds will have a good amount of exposure to government debt, in addition to modest holdings in the corporate bond market.
History of Fund/Manager
PRSNX finds itself in the T. Rowe Price family, based out of Baltimore, MD. The T. Rowe Price Global Multi-Sector Bond Investor made its debut in December of 2008 and PRSNX has managed to accumulate roughly $1.07 billion in assets, as of the most recently available information. The fund is currently managed by Kenneth Orchard who has been in charge of the fund since January of 2018.
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 5.46%, 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 6.2%, 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 11.46%, the standard deviation of PRSNX over the past three years is 7.08%. Looking at the past 5 years, the fund's standard deviation is 5.72% compared to the category average of 9.48%. This makes the fund less volatile than its peers over the past half-decade.
This fund has a beta of 0.89, meaning that it is less volatile than a broad market index of fixed income securities. Taking this into account, PRSNX has a positive alpha of 2.58, which measures performance on a risk-adjusted basis.
Ratings
Investors should also consider a bond's rating, which is a grade ( 'AAA' to 'D' ) given to a bond that indicates its credit quality. With this letter scale in mind, PRSNX has 32.73% in medium quality bonds, with ratings of 'A' to 'BBB'. The fund's junk bond component-bonds rated 'BB' or below-is at 30.94%, giving PRSNX an average quality of BBB. This means that it focuses on medium quality securities.
Expenses
For investors, taking a closer look at cost-related metrics is key, since costs are increasingly important for mutual fund investing. Competition is heating up in this space, and a lower cost product will likely outperform its otherwise identical counterpart, all things being equal. In terms of fees, PRSNX is a no load fund. It has an expense ratio of 0.65% compared to the category average of 0.85%. Looking at the fund from a cost perspective, PRSNX 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 Global Multi-Sector Bond Investor ( PRSNX ) has a low Zacks Mutual Fund rank, and in conjunction with its comparatively strong performance, average downside risk, and lower fees, T. Rowe Price Global Multi-Sector Bond Investor ( PRSNX ) looks like a somewhat weak choice for investors right now.
This could just be the start of your research on PRSNXin the Diversified Bonds 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.