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If investors are looking at the Mutual Fund Bond fund category, make sure to pass over T. Rowe Price Tax Free Income Adviser (PATAX - Free Report) . PATAX bears a Zacks Mutual Fund Rank of 4 (Sell), which is based on nine forecasting factors like size, cost, and past performance.
History of Fund/Manager
T. Rowe Price is based in Baltimore, MD, and is the manager of PATAX. T. Rowe Price Tax Free Income Adviser debuted in October of 1976. Since then, PATAX has accumulated assets of about $72 million, according to the most recently available information. The fund is currently managed by Konstantine B. Mallas who has been in charge of the fund since July of 2007.
Performance
Of course, investors look for strong performance in funds. This fund in particular has delivered a 5-year annualized total return of 1.41%, and is 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 0.27%, 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 11.72%, the standard deviation of PATAX over the past three years is 5.64%. Over the past 5 years, the standard deviation of the fund is 4.56% compared to the category average of 10.26%. This makes the fund less volatile than its peers over the past half-decade.
This fund has a beta of 0.77, meaning that it is less volatile than a broad market index of fixed income securities. Taking this into account, PATAX has a negative alpha of -0.41, 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, PATAX has 43% in high quality bonds rated at least 'AA' or higher, while 46.08% are of medium quality, with ratings of 'A' to 'BBB'. The fund has an average quality of A, and focuses on high quality securities.
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, PATAX is a no load fund. It has an expense ratio of 0.86% compared to the category average of 0.79%. So, PATAX is actually more expensive than its peers from a cost perspective.
While the minimum initial investment for the product is $2,500, investors should also note that each subsequent investment needs to be at least $100.
Bottom Line
Overall, T. Rowe Price Tax Free Income Adviser ( PATAX ) has a low Zacks Mutual Fund rank, and in conjunction with its comparatively similar performance, better downside risk, and higher fees, T. Rowe Price Tax Free Income Adviser ( PATAX ) looks like a somewhat weak choice for investors right now.
This could just be the start of your research on PATAXin the Mutual Fund Bond 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. 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 PATAX a Strong Bond Fund Right Now?
If investors are looking at the Mutual Fund Bond fund category, make sure to pass over T. Rowe Price Tax Free Income Adviser (PATAX - Free Report) . PATAX bears a Zacks Mutual Fund Rank of 4 (Sell), which is based on nine forecasting factors like size, cost, and past performance.
History of Fund/Manager
T. Rowe Price is based in Baltimore, MD, and is the manager of PATAX. T. Rowe Price Tax Free Income Adviser debuted in October of 1976. Since then, PATAX has accumulated assets of about $72 million, according to the most recently available information. The fund is currently managed by Konstantine B. Mallas who has been in charge of the fund since July of 2007.
Performance
Of course, investors look for strong performance in funds. This fund in particular has delivered a 5-year annualized total return of 1.41%, and is 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 0.27%, 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 11.72%, the standard deviation of PATAX over the past three years is 5.64%. Over the past 5 years, the standard deviation of the fund is 4.56% compared to the category average of 10.26%. This makes the fund less volatile than its peers over the past half-decade.
This fund has a beta of 0.77, meaning that it is less volatile than a broad market index of fixed income securities. Taking this into account, PATAX has a negative alpha of -0.41, 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, PATAX has 43% in high quality bonds rated at least 'AA' or higher, while 46.08% are of medium quality, with ratings of 'A' to 'BBB'. The fund has an average quality of A, and focuses on high quality securities.
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, PATAX is a no load fund. It has an expense ratio of 0.86% compared to the category average of 0.79%. So, PATAX is actually more expensive than its peers from a cost perspective.
While the minimum initial investment for the product is $2,500, investors should also note that each subsequent investment needs to be at least $100.
Bottom Line
Overall, T. Rowe Price Tax Free Income Adviser ( PATAX ) has a low Zacks Mutual Fund rank, and in conjunction with its comparatively similar performance, better downside risk, and higher fees, T. Rowe Price Tax Free Income Adviser ( PATAX ) looks like a somewhat weak choice for investors right now.
This could just be the start of your research on PATAXin the Mutual Fund Bond 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. 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.