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Is T. Rowe Price Institutional Small-Cap Stock (TRSSX) a Strong Mutual Fund Pick Right Now?
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If investors are looking at the Small Cap Blend fund category, T. Rowe Price Institutional Small-Cap Stock (TRSSX - Free Report) could be a potential option. TRSSX has a Zacks Mutual Fund Rank of 1 (Strong Buy), which is based on nine forecasting factors like size, cost, and past performance.
Objective
TRSSX is one of many Small Cap Blend funds to choose from. Small Cap Blend mutual funds allow investors a way to diversify their funds among various types of small-cap stocks. These funds seek companies with market capitalization of less than $2 billion, and aid in reducing volatility inherent in lower market cap stocks.
History of Fund/Manager
T. Rowe Price is based in Baltimore, MD, and is the manager of TRSSX. Since T. Rowe Price Institutional Small-Cap Stock made its debut in October of 2000, TRSSX has garnered more than $4.73 billion in assets. Frank M. Alonso is the fund's current manager and has held that role since October of 2016.
Performance
Of course, investors look for strong performance in funds. This fund has delivered a 5-year annualized total return of 9.83%, 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 12.74%, 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, TRSSX's standard deviation comes in at 12.75%, compared to the category average of 14.5%. The fund's standard deviation over the past 5 years is 13.02% compared to the category average of 14.28%. This makes the fund less volatile than its peers over the past half-decade.
Risk Factors
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 the most recent bear market, TRSSX lost 49.13% and outperformed its peer group by 3.32%. These results could imply that the fund is a better choice than its peers during a sliding market environment.
Even still, the fund has a 5-year beta of 1.03, so investors should note that it is hypothetically as volatile as the market at large. 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. TRSSX's 5-year performance has produced a negative alpha of -1.33, which means 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 primarily on equities that are traded in the United States.
The mutual fund currently has 81.5% of its holdings in stocks, and these companies have an average market capitalization of $3.93 billion. The fund has the heaviest exposure to the following market sectors:
Finance
Other
Industrial Cyclical
Technology
Turnover is about 43.2%, so those in charge of the fund make fewer trades than the average comparable fund.
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, TRSSX is a no load fund. It has an expense ratio of 0.66% compared to the category average of 1.08%. TRSSX is actually cheaper than its peers when you consider factors like cost.
This fund requires a minimum initial investment of $1 million, while there is no minimum for each subsequent investment.
Bottom Line
Overall, T. Rowe Price Institutional Small-Cap Stock ( TRSSX ) has a high Zacks Mutual Fund rank, and in conjunction with its comparatively strong performance, average downside risk, and lower fees, T. Rowe Price Institutional Small-Cap Stock ( TRSSX ) looks like a good potential choice for investors right now.
Want even more information about TRSSX? 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. 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 Institutional Small-Cap Stock (TRSSX) a Strong Mutual Fund Pick Right Now?
If investors are looking at the Small Cap Blend fund category, T. Rowe Price Institutional Small-Cap Stock (TRSSX - Free Report) could be a potential option. TRSSX has a Zacks Mutual Fund Rank of 1 (Strong Buy), which is based on nine forecasting factors like size, cost, and past performance.
Objective
TRSSX is one of many Small Cap Blend funds to choose from. Small Cap Blend mutual funds allow investors a way to diversify their funds among various types of small-cap stocks. These funds seek companies with market capitalization of less than $2 billion, and aid in reducing volatility inherent in lower market cap stocks.
History of Fund/Manager
T. Rowe Price is based in Baltimore, MD, and is the manager of TRSSX. Since T. Rowe Price Institutional Small-Cap Stock made its debut in October of 2000, TRSSX has garnered more than $4.73 billion in assets. Frank M. Alonso is the fund's current manager and has held that role since October of 2016.
Performance
Of course, investors look for strong performance in funds. This fund has delivered a 5-year annualized total return of 9.83%, 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 12.74%, 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, TRSSX's standard deviation comes in at 12.75%, compared to the category average of 14.5%. The fund's standard deviation over the past 5 years is 13.02% compared to the category average of 14.28%. This makes the fund less volatile than its peers over the past half-decade.
Risk Factors
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 the most recent bear market, TRSSX lost 49.13% and outperformed its peer group by 3.32%. These results could imply that the fund is a better choice than its peers during a sliding market environment.
Even still, the fund has a 5-year beta of 1.03, so investors should note that it is hypothetically as volatile as the market at large. 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. TRSSX's 5-year performance has produced a negative alpha of -1.33, which means 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 primarily on equities that are traded in the United States.
The mutual fund currently has 81.5% of its holdings in stocks, and these companies have an average market capitalization of $3.93 billion. The fund has the heaviest exposure to the following market sectors:
- Finance
- Other
- Industrial Cyclical
- Technology
Turnover is about 43.2%, so those in charge of the fund make fewer trades than the average comparable fund.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, TRSSX is a no load fund. It has an expense ratio of 0.66% compared to the category average of 1.08%. TRSSX is actually cheaper than its peers when you consider factors like cost.
This fund requires a minimum initial investment of $1 million, while there is no minimum for each subsequent investment.
Bottom Line
Overall, T. Rowe Price Institutional Small-Cap Stock ( TRSSX ) has a high Zacks Mutual Fund rank, and in conjunction with its comparatively strong performance, average downside risk, and lower fees, T. Rowe Price Institutional Small-Cap Stock ( TRSSX ) looks like a good potential choice for investors right now.
Want even more information about TRSSX? 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. 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.