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Is T. Rowe Price Communications & Technology Fund (PRMTX) a Strong Mutual Fund Pick Right Now?
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If you have been looking for Sector - Tech funds, a place to start could be T. Rowe Price Communications & Technology Fund (PRMTX - Free Report) . PRMTX bears a Zacks Mutual Fund Rank of 2 (Buy), which is based on various forecasting factors like size, cost, and past performance.
Objective
We note that PRMTX is a Sector - Tech option, and this area is loaded with many options. Found in a wide number of industries such as semiconductors, software, internet, and networking, tech companies are everywhere. Thus, Sector - Tech mutual funds that invest in technology let investors own a stake in a notoriously volatile sector, but with a much more diversifies approach.
History of Fund/Manager
T. Rowe Price is based in Baltimore, MD, and is the manager of PRMTX. T. Rowe Price Communications & Technology Fund made its debut in July of 1997, and since then, PRMTX has accumulated about $5.25 billion in assets, per the most up-to-date date available. James Stillwagon is the fund's current manager and has held that role since November of 2019.
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 14.55%, and is 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 11.1%, which places it in the middle third during this time-frame.
It is important to note that the product's returns may not reflect all its expenses. Any fees not reflected would lower the returns. Total returns do not reflect the fund's [%] sale charge. If sales charges were included, total returns would have been lower.
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 17.28%, the standard deviation of PRMTX over the past three years is 20.62%. Over the past 5 years, the standard deviation of the fund is 20.65% compared to the category average of 17.83%. This makes the fund more volatile than its peers over the past half-decade.
Risk Factors
Investors should note that the fund has a 5-year beta of 0.98, so it is likely going to be as volatile as the market at large. Another factor to consider is alpha, as it reflects a portfolio's performance on a risk-adjusted basis relative to a benchmark-in this case, the S&P 500. PRMTX has generated a positive alpha over the past five years of 0.24, demonstrating that managers in this portfolio are skilled in picking securities that generate better-than-benchmark returns.
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, PRMTX is a no load fund. It has an expense ratio of 0.77% compared to the category average of 0.90%. So, PRMTX is actually cheaper than its peers from a cost perspective.
This fund requires a minimum initial investment of $2,500, and each subsequent investment should be at least $100.
Fees charged by investment advisors have not been taken into considiration. Returns would be less if those were included.
Bottom Line
Overall, T. Rowe Price Communications & Technology Fund ( PRMTX ) has a high Zacks Mutual Fund rank, and in conjunction with its comparatively strong performance, average downside risk, and lower fees, T. Rowe Price Communications & Technology Fund ( PRMTX ) looks like a good potential choice for investors right now.
Want even more information about PRMTX? Then go over to Zacks.com and check out our mutual fund comparison tool, and all of the other great features that we have to help you with your mutual fund analysis for additional information. Zacks provides a full suite of tools to help you analyze your portfolio - both funds and stocks - in the most efficient way possible.
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Is T. Rowe Price Communications & Technology Fund (PRMTX) a Strong Mutual Fund Pick Right Now?
If you have been looking for Sector - Tech funds, a place to start could be T. Rowe Price Communications & Technology Fund (PRMTX - Free Report) . PRMTX bears a Zacks Mutual Fund Rank of 2 (Buy), which is based on various forecasting factors like size, cost, and past performance.
Objective
We note that PRMTX is a Sector - Tech option, and this area is loaded with many options. Found in a wide number of industries such as semiconductors, software, internet, and networking, tech companies are everywhere. Thus, Sector - Tech mutual funds that invest in technology let investors own a stake in a notoriously volatile sector, but with a much more diversifies approach.
History of Fund/Manager
T. Rowe Price is based in Baltimore, MD, and is the manager of PRMTX. T. Rowe Price Communications & Technology Fund made its debut in July of 1997, and since then, PRMTX has accumulated about $5.25 billion in assets, per the most up-to-date date available. James Stillwagon is the fund's current manager and has held that role since November of 2019.
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 14.55%, and is 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 11.1%, which places it in the middle third during this time-frame.
It is important to note that the product's returns may not reflect all its expenses. Any fees not reflected would lower the returns. Total returns do not reflect the fund's [%] sale charge. If sales charges were included, total returns would have been lower.
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 17.28%, the standard deviation of PRMTX over the past three years is 20.62%. Over the past 5 years, the standard deviation of the fund is 20.65% compared to the category average of 17.83%. This makes the fund more volatile than its peers over the past half-decade.
Risk Factors
Investors should note that the fund has a 5-year beta of 0.98, so it is likely going to be as volatile as the market at large. Another factor to consider is alpha, as it reflects a portfolio's performance on a risk-adjusted basis relative to a benchmark-in this case, the S&P 500. PRMTX has generated a positive alpha over the past five years of 0.24, demonstrating that managers in this portfolio are skilled in picking securities that generate better-than-benchmark returns.
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, PRMTX is a no load fund. It has an expense ratio of 0.77% compared to the category average of 0.90%. So, PRMTX is actually cheaper than its peers from a cost perspective.
This fund requires a minimum initial investment of $2,500, and each subsequent investment should be at least $100.
Fees charged by investment advisors have not been taken into considiration. Returns would be less if those were included.
Bottom Line
Overall, T. Rowe Price Communications & Technology Fund ( PRMTX ) has a high Zacks Mutual Fund rank, and in conjunction with its comparatively strong performance, average downside risk, and lower fees, T. Rowe Price Communications & Technology Fund ( PRMTX ) looks like a good potential choice for investors right now.
Want even more information about PRMTX? Then go over to Zacks.com and check out our mutual fund comparison tool, and all of the other great features that we have to help you with your mutual fund analysis for additional information. Zacks provides a full suite of tools to help you analyze your portfolio - both funds and stocks - in the most efficient way possible.