All Cap Value fund seekers should not consider taking a look at T. Rowe Price Cap Appreciation (PRWCX - Free Report) at this time. PRWCX has a Zacks Mutual Fund Rank of 4 (Sell), which is based on nine forecasting factors like size, cost, and past performance.
We classify PRWCX in the All Cap Value category, an area rife with potential choices. Like the name suggests, MUTUAL FUNDS invest in small, medium, and large-cap companies, though they end up focusing on bigger firms due to percentage of assets. These funds look for key value characteristics, targeting stocks that boast low P/E ratios, high dividend yields, and whose share prices do not reflect their worth.
History of Fund/Manager
PRWCX finds itself in the T. Rowe Price family, based out of Baltimore, MD. The T. Rowe Price Cap Appreciation made its debut in June of 1986 and PRWCX has managed to accumulate roughly $25.41 billion in assets, as of the most recently available information. The fund is currently managed by David R. Giroux who has been in charge of the fund since June of 2006.
Of course, investors look for strong performance in funds. PRWCX has a 5-year annualized total return of 11.66% and it sits in the top third among its category peers. Investors who prefer analyzing shorter time frames should look at its 3-year annualized total return of 8.75%, 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. Over the past three years, PRWCX's standard deviation comes in at 6.67%, compared to the category average of 9.64%. Over the past 5 years, the standard deviation of the fund is 6.42% compared to the category average of 9.44%. This makes the fund less volatile than its peers over the past half-decade.
It's always important to be aware of the downsides to any future investment, so one should not discount the risks that come with this segment. In PRWCX's case, the fund lost 36.16% in the most recent bear market and outperformed its peer group by 13.32%. These results could imply that the fund is a better choice than its peers during a sliding market environment.
Nevertheless, with a 5-year beta of 0.62, 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. Over the past 5 years, the fund has a positive alpha of 2.27. This means that managers in this portfolio are skilled in picking securities that generate better-than-benchmark returns.
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, PRWCX is a no load fund. It has an expense ratio of 0.69% compared to the category average of 1.17%. So, PRWCX 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.
Overall, T. Rowe Price Cap Appreciation has a low Zacks Mutual Fund rank, and in conjunction with its comparatively strong performance, average downside risk, and lower fees, T. Rowe Price Cap Appreciation looks like a somewhat weak choice for investors right now.
This could just be the start of your research on PRWCX in the All Cap Value 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. Zacks provides a full suite of tools to help you analyze your portfolio - both funds and stocks - in the most efficient way possible.