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Is T. Rowe Price Blue Chip Growth Adviser (PABGX) a Strong Mutual Fund Pick Right Now?
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On the lookout for a Large Cap Growth fund? Starting with T. Rowe Price Blue Chip Growth Adviser (PABGX - Free Report) is one possibility. PABGX possesses a Zacks Mutual Fund Rank of 1 (Strong Buy), which is based on various forecasting factors like size, cost, and past performance.
Objective
PABGX is classified in the Large Cap Growth segment by Zacks, an area full of possibilities. Companies are usually considered to be large-cap if their stock market valuation is more than $10 billion. Large Cap Growth mutual funds invest in many large U.S. firms that are projected to grow at a faster rate than their large-cap peers.
History of Fund/Manager
T. Rowe Price is based in Baltimore, MD, and is the manager of PABGX. T. Rowe Price Blue Chip Growth Adviser debuted in June of 1993. Since then, PABGX has accumulated assets of about $1.21 billion, according to the most recently available information. The fund's current manager, Paul Greene, has been in charge of the fund since October of 2021.
Performance
Investors naturally seek funds with strong performance. This fund in particular has delivered a 5-year annualized total return of 13.92%, and is in the middle 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 32.16%, which places it in the top 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 12.85%, the standard deviation of PABGX over the past three years is 16.32%. Looking at the past 5 years, the fund's standard deviation is 19.68% compared to the category average of 14.48%. 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 1.13, which means it is hypothetically more volatile than 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. With a negative alpha of -4.19, managers in this portfolio find it difficult to pick 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 mostly on equities that are traded in the United States.
The mutual fund currently has 75.32% of its holdings in stocks, and these companies have an average market capitalization of $939.45 billion. The fund has the heaviest exposure to the following market sectors:
Technology
Retail Trade
Turnover is about 19.6%, so those in charge of the fund make fewer trades than comparable funds.
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, PABGX is a no load fund. It has an expense ratio of 0.97% compared to the category average of 0.95%. PABGX is actually more expensive than its peers when you consider factors like cost.
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.
Fees charged by investment advisors have not been taken into consideration. Returns would be less if those were included.
Bottom Line
Overall, even with its comparatively similar performance, worse downside risk, and higher fees, T. Rowe Price Blue Chip Growth Adviser ( PABGX ) has a high Zacks Mutual Fund rank, and therefore looks a good potential choice for investors right now.
Your research on the Large Cap Growth 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 Blue Chip Growth Adviser (PABGX) a Strong Mutual Fund Pick Right Now?
On the lookout for a Large Cap Growth fund? Starting with T. Rowe Price Blue Chip Growth Adviser (PABGX - Free Report) is one possibility. PABGX possesses a Zacks Mutual Fund Rank of 1 (Strong Buy), which is based on various forecasting factors like size, cost, and past performance.
Objective
PABGX is classified in the Large Cap Growth segment by Zacks, an area full of possibilities. Companies are usually considered to be large-cap if their stock market valuation is more than $10 billion. Large Cap Growth mutual funds invest in many large U.S. firms that are projected to grow at a faster rate than their large-cap peers.
History of Fund/Manager
T. Rowe Price is based in Baltimore, MD, and is the manager of PABGX. T. Rowe Price Blue Chip Growth Adviser debuted in June of 1993. Since then, PABGX has accumulated assets of about $1.21 billion, according to the most recently available information. The fund's current manager, Paul Greene, has been in charge of the fund since October of 2021.
Performance
Investors naturally seek funds with strong performance. This fund in particular has delivered a 5-year annualized total return of 13.92%, and is in the middle 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 32.16%, which places it in the top 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 12.85%, the standard deviation of PABGX over the past three years is 16.32%. Looking at the past 5 years, the fund's standard deviation is 19.68% compared to the category average of 14.48%. 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 1.13, which means it is hypothetically more volatile than 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. With a negative alpha of -4.19, managers in this portfolio find it difficult to pick 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 mostly on equities that are traded in the United States.
The mutual fund currently has 75.32% of its holdings in stocks, and these companies have an average market capitalization of $939.45 billion. The fund has the heaviest exposure to the following market sectors:
Turnover is about 19.6%, so those in charge of the fund make fewer trades than comparable funds.
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, PABGX is a no load fund. It has an expense ratio of 0.97% compared to the category average of 0.95%. PABGX is actually more expensive than its peers when you consider factors like cost.
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.
Fees charged by investment advisors have not been taken into consideration. Returns would be less if those were included.
Bottom Line
Overall, even with its comparatively similar performance, worse downside risk, and higher fees, T. Rowe Price Blue Chip Growth Adviser ( PABGX ) has a high Zacks Mutual Fund rank, and therefore looks a good potential choice for investors right now.
Your research on the Large Cap Growth 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.