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Is T. Rowe Price Value Fund (TRVLX) a Strong Mutual Fund Pick Right Now?
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On the lookout for a Large Cap Value fund? Starting with T. Rowe Price Value Fund (TRVLX - Free Report) is one possibility. TRVLX holds a Zacks Mutual Fund Rank of 1 (Strong Buy), which is based on nine forecasting factors like size, cost, and past performance.
Objective
Large Cap Value mutual funds invest in stocks with a market capitalization of $10 billion or more, but whose share prices do not reflect their intrinsic value; this value investing strategy often leads to low P/E ratios and high dividend yields, though growth levels are often curtailed. The high-growth opportunity of these funds are slowed even further, as large-cap securities are generally in stable industries with low to moderate growth prospects. Therefore, Large Cap Value funds are usually more appealing to investors who are interested in a stable income stream.
History of Fund/Manager
T. Rowe Price is based in Baltimore, MD, and is the manager of TRVLX. Since T. Rowe Price Value Fund made its debut in September of 1994, TRVLX has garnered more than $5.51 billion in assets. Mark Finn is the fund's current manager and has held that role since December of 2009.
Performance
Of course, investors look for strong performance in funds. This fund carries a 5-year annualized total return of 14.54%, and it sits in the top 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 16.07%, 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. TRVLX's standard deviation over the past three years is 18.86% compared to the category average of 16.76%. Over the past 5 years, the standard deviation of the fund is 15.23% compared to the category average of 13.77%. This makes the fund more volatile than its peers over the past half-decade.
Risk Factors
The fund has a 5-year beta of 0.96, so investors should note that it is hypothetically less volatile than the market at large. 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. Over the past 5 years, the fund has a negative alpha of -2.23. This means that managers in this portfolio find it difficult to pick securities that generate better-than-benchmark returns.
Holdings
Investigating 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 primarily on equities that are traded in the United States.
The mutual fund currently has 82.66% of its holdings in stocks, and these companies have an average market capitalization of $323.78 billion. The fund has the heaviest exposure to the following market sectors:
Finance
Technology
Industrial Cyclical
With turnover at about 107.2%, this fund makes more traders than comparable funds in a given year.
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, TRVLX is a no load fund. It has an expense ratio of 0.73% compared to the category average of 1%. TRVLX 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 Value Fund ( TRVLX ) has a high Zacks Mutual Fund rank, and in conjunction with its comparatively strong performance, average downside risk, and lower fees, T. Rowe Price Value Fund ( TRVLX ) looks like a good potential choice for investors right now.
Your research on the Large Cap Value segment doesn't have to stop here. You can check out all the great mutual fund tools we have to offer by going to www.zacks.com/funds/mutual-funds to see the additional features we offer as well for additional information. Want to learn even more? We have a full suite of tools on stocks that you can use to find the best choices for your portfolio too, no matter what kind of investor you are.
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Is T. Rowe Price Value Fund (TRVLX) a Strong Mutual Fund Pick Right Now?
On the lookout for a Large Cap Value fund? Starting with T. Rowe Price Value Fund (TRVLX - Free Report) is one possibility. TRVLX holds a Zacks Mutual Fund Rank of 1 (Strong Buy), which is based on nine forecasting factors like size, cost, and past performance.
Objective
Large Cap Value mutual funds invest in stocks with a market capitalization of $10 billion or more, but whose share prices do not reflect their intrinsic value; this value investing strategy often leads to low P/E ratios and high dividend yields, though growth levels are often curtailed. The high-growth opportunity of these funds are slowed even further, as large-cap securities are generally in stable industries with low to moderate growth prospects. Therefore, Large Cap Value funds are usually more appealing to investors who are interested in a stable income stream.
History of Fund/Manager
T. Rowe Price is based in Baltimore, MD, and is the manager of TRVLX. Since T. Rowe Price Value Fund made its debut in September of 1994, TRVLX has garnered more than $5.51 billion in assets. Mark Finn is the fund's current manager and has held that role since December of 2009.
Performance
Of course, investors look for strong performance in funds. This fund carries a 5-year annualized total return of 14.54%, and it sits in the top 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 16.07%, 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. TRVLX's standard deviation over the past three years is 18.86% compared to the category average of 16.76%. Over the past 5 years, the standard deviation of the fund is 15.23% compared to the category average of 13.77%. This makes the fund more volatile than its peers over the past half-decade.
Risk Factors
The fund has a 5-year beta of 0.96, so investors should note that it is hypothetically less volatile than the market at large. 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. Over the past 5 years, the fund has a negative alpha of -2.23. This means that managers in this portfolio find it difficult to pick securities that generate better-than-benchmark returns.
Holdings
Investigating 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 primarily on equities that are traded in the United States.
The mutual fund currently has 82.66% of its holdings in stocks, and these companies have an average market capitalization of $323.78 billion. The fund has the heaviest exposure to the following market sectors:
- Finance
- Technology
- Industrial Cyclical
With turnover at about 107.2%, this fund makes more traders than comparable funds in a given year.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, TRVLX is a no load fund. It has an expense ratio of 0.73% compared to the category average of 1%. TRVLX 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 Value Fund ( TRVLX ) has a high Zacks Mutual Fund rank, and in conjunction with its comparatively strong performance, average downside risk, and lower fees, T. Rowe Price Value Fund ( TRVLX ) looks like a good potential choice for investors right now.
Your research on the Large Cap Value segment doesn't have to stop here. You can check out all the great mutual fund tools we have to offer by going to www.zacks.com/funds/mutual-funds to see the additional features we offer as well for additional information. Want to learn even more? We have a full suite of tools on stocks that you can use to find the best choices for your portfolio too, no matter what kind of investor you are.