On the lookout for a Mutual Fund Equity Report fund? Starting with T. Rowe Price Dividend Growth Fund (PRDGX Quick QuotePRDGX - Free Report) is one possibility. PRDGX bears a Zacks Mutual Fund Rank of 1 (Strong Buy), which is based on various forecasting factors like size, cost, and past performance.

History of Fund/Manager

PRDGX is a part of the T. Rowe Price family of funds, a company based out of Baltimore, MD. T. Rowe Price Dividend Growth Fund debuted in December of 1992. Since then, PRDGX has accumulated assets of about $10.33 billion, according to the most recently available information. The fund is currently managed by Thomas J. Huber who has been in charge of the fund since March of 2000.

Performance

Investors naturally seek funds with strong performance. This fund carries a 5-year annualized total return of 10.51%, and it sits in the top third among its category peers. But if you are looking for a shorter time frame, it is also worth looking at its 3-year annualized total return of 9.97%, 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 18.48%, the standard deviation of PRDGX over the past three years is 19.03%. The fund's standard deviation over the past 5 years is 16.42% compared to the category average of 16.25%. This makes the fund more volatile than its peers over the past half-decade.

Risk Factors

With a 5-year beta of 0.85, the fund is likely to be less 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. The fund has produced a positive alpha over the past 5 years of 1.91, which shows that managers in this portfolio are skilled in picking securities that generate better-than-benchmark returns.

Holdings

Exploring 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.

As of the last filing date, the mutual fund has 95.81% of its assets in stocks, with an average market capitalization of $217.50 billion. The fund has the heaviest exposure to the following market sectors:

• Technology
• Finance
• Industrial Cyclical
• Non-Durable

With turnover at about 18.2%, this fund is making fewer trades than comparable funds.

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, PRDGX is a no load fund. It has an expense ratio of 0.64% compared to the category average of 0.91%. Looking at the fund from a cost perspective, PRDGX is actually cheaper than its peers.

Investors should also note that the minimum initial investment for the product is $2,500 and that each subsequent investment needs to be at $100.

Bottom Line

Overall, T. Rowe Price Dividend Growth Fund ( PRDGX ) 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.

Your research on the Mutual Fund Equity Report 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.