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Is T. Rowe Price Institutional Small-Cap Stock (TRSSX) a Strong Mutual Fund Pick Right Now?
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If you've been stuck searching for Small Cap Blend funds, consider T. Rowe Price Institutional Small-Cap Stock (TRSSX - Free Report) as a possibility. TRSSX holds a Zacks Mutual Fund Rank of 1 (Strong Buy), which is based on nine forecasting factors like size, cost, and past performance.
Objective
Zacks categorizes TRSSX as Small Cap Blend, which is an area packed with options. Usually targeting stocks with market caps of less than $2 billion, a Small Cap Blend mutual fund lets investors diversify their funds among other kinds of small-cap equities. This can help reduce risk found in companies that have a lower stock market valuation.
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 $6.16 billion in assets, as of the most recently available information. Frank Alonso is the fund's current manager and has held that role since October of 2016.
Performance
Obviously, what investors are looking for in these funds is strong performance relative to their peers. This fund carries a 5-year annualized total return of 19.92%, and it sits in the middle third among its category peers. If you're interested in shorter time frames, do not dismiss looking at the fund's 3-year annualized total return of 21.63%, 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. Over the past three years, TRSSX's standard deviation comes in at 22.11%, compared to the category average of 25.55%. Looking at the past 5 years, the fund's standard deviation is 18.01% compared to the category average of 20.67%. This makes the fund less volatile than its peers over the past half-decade.
Risk Factors
With a 5-year beta of 1.08, the fund is likely to be more volatile than the market average. 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. Over the past 5 years, the fund has a positive alpha of 1.34. 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.
Right now, 85.09% of this mutual fund's holdings are stocks, with an average market capitalization of $6.36 billion. The fund has the heaviest exposure to the following market sectors:
Finance
Industrial Cyclical
Health
Technology
Other
With turnover at about 22.6%, this fund makes fewer trades than the average comparable fund.
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, TRSSX is a no load fund. It has an expense ratio of 0.66% compared to the category average of 1.11%. Looking at the fund from a cost perspective, TRSSX is actually cheaper than its peers.
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 similar performance, average downside risk, and lower fees, T. Rowe Price Institutional Small-Cap Stock ( TRSSX ) looks like a great potential choice for investors right now.
Don't stop here for your research on Small Cap Blend 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 TRSSX to its peers as well for additional information. If you are more of a stock investor, make sure to also check out our Zacks Rank, and our full suite of tools we have available for novice and professional investors alike.
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Is T. Rowe Price Institutional Small-Cap Stock (TRSSX) a Strong Mutual Fund Pick Right Now?
If you've been stuck searching for Small Cap Blend funds, consider T. Rowe Price Institutional Small-Cap Stock (TRSSX - Free Report) as a possibility. TRSSX holds a Zacks Mutual Fund Rank of 1 (Strong Buy), which is based on nine forecasting factors like size, cost, and past performance.
Objective
Zacks categorizes TRSSX as Small Cap Blend, which is an area packed with options. Usually targeting stocks with market caps of less than $2 billion, a Small Cap Blend mutual fund lets investors diversify their funds among other kinds of small-cap equities. This can help reduce risk found in companies that have a lower stock market valuation.
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 $6.16 billion in assets, as of the most recently available information. Frank Alonso is the fund's current manager and has held that role since October of 2016.
Performance
Obviously, what investors are looking for in these funds is strong performance relative to their peers. This fund carries a 5-year annualized total return of 19.92%, and it sits in the middle third among its category peers. If you're interested in shorter time frames, do not dismiss looking at the fund's 3-year annualized total return of 21.63%, 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. Over the past three years, TRSSX's standard deviation comes in at 22.11%, compared to the category average of 25.55%. Looking at the past 5 years, the fund's standard deviation is 18.01% compared to the category average of 20.67%. This makes the fund less volatile than its peers over the past half-decade.
Risk Factors
With a 5-year beta of 1.08, the fund is likely to be more volatile than the market average. 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. Over the past 5 years, the fund has a positive alpha of 1.34. 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.
Right now, 85.09% of this mutual fund's holdings are stocks, with an average market capitalization of $6.36 billion. The fund has the heaviest exposure to the following market sectors:
- Finance
- Industrial Cyclical
- Health
- Technology
- Other
With turnover at about 22.6%, this fund makes fewer trades than the average comparable fund.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, TRSSX is a no load fund. It has an expense ratio of 0.66% compared to the category average of 1.11%. Looking at the fund from a cost perspective, TRSSX is actually cheaper than its peers.
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 similar performance, average downside risk, and lower fees, T. Rowe Price Institutional Small-Cap Stock ( TRSSX ) looks like a great potential choice for investors right now.
Don't stop here for your research on Small Cap Blend 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 TRSSX to its peers as well for additional information. If you are more of a stock investor, make sure to also check out our Zacks Rank, and our full suite of tools we have available for novice and professional investors alike.