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Any investors hoping to find a Diversified Bonds fund might consider looking past T. Rowe Price Global Multi-Sector Bond Investor (PRSNX - Free Report) . PRSNX possesses a Zacks Mutual Fund Rank of 5 (Strong Sell), which is based on nine forecasting factors like size, cost, and past performance.
Objective
The world of Diversified Bonds funds is an area filled with options, such as PRSNX. Investors looking for exposure to a variety of fixed income types that stretch across issuers, maturities, and credit levels will find a good fit with Diversified Bonds funds. Typically, these funds have a solid amount of exposure to government debt, as well as modest holdings in the corporate bond market.
History of Fund/Manager
T. Rowe Price is based in Baltimore, MD, and is the manager of PRSNX. Since T. Rowe Price Global Multi-Sector Bond Investor made its debut in December of 2008, PRSNX has garnered more than $1.01 billion in assets. The fund's current manager, Kenneth Orchard, has been in charge of the fund since January of 2018.
Performance
Of course, investors look for strong performance in funds. This fund has delivered a 5-year annualized total return of 3.28%, 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 2.82%, 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. PRSNX's standard deviation over the past three years is 6.5% compared to the category average of 9.61%. The fund's standard deviation over the past 5 years is 5.52% compared to the category average of 8.81%. This makes the fund less volatile than its peers over the past half-decade.
This fund has a beta of 1, meaning that it is volatile than a broad market index of fixed income securities. Taking this into account, PRSNX has a negative alpha of -0.12, which measures performance on a risk-adjusted basis.
Ratings
Investors should also consider a bond's rating, which is a grade ( 'AAA' to 'D' ) given to a bond that indicates its credit quality. With this letter scale in mind, PRSNX has 28% in high quality bonds rated at least 'AA' or higher, while 35.5% are of medium quality, with ratings of 'A' to 'BBB'. The fund's junk bond component-bonds rated 'BB' or below-is at 24%, giving PRSNX an average quality of A. This means that it focuses on high quality securities.
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, PRSNX is a no load fund. It has an expense ratio of 0.64% compared to the category average of 0.89%. Looking at the fund from a cost perspective, PRSNX is actually cheaper than its peers.
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.
Bottom Line
Overall, T. Rowe Price Global Multi-Sector Bond Investor ( PRSNX ) has a low Zacks Mutual Fund rank, and in conjunction with its comparatively strong performance, average downside risk, and lower fees, this fund looks like a somewhat weak choice for investors right now.
Don't stop here for your research on Diversified Bonds funds. We also have plenty more on our site in order to help you find the best possible fund for your portfolio. Make sure to check out www.zacks.com/funds/mutual-funds for more information about the world of funds, and feel free to compare PRSNX to its peers as well for additional information. If you are more of a stock investor, make sure to also check out our Zacks Rank, and our full suite of tools we have available for novice and professional investors alike.
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Is PRSNX a Strong Bond Fund Right Now?
Any investors hoping to find a Diversified Bonds fund might consider looking past T. Rowe Price Global Multi-Sector Bond Investor (PRSNX - Free Report) . PRSNX possesses a Zacks Mutual Fund Rank of 5 (Strong Sell), which is based on nine forecasting factors like size, cost, and past performance.
Objective
The world of Diversified Bonds funds is an area filled with options, such as PRSNX. Investors looking for exposure to a variety of fixed income types that stretch across issuers, maturities, and credit levels will find a good fit with Diversified Bonds funds. Typically, these funds have a solid amount of exposure to government debt, as well as modest holdings in the corporate bond market.
History of Fund/Manager
T. Rowe Price is based in Baltimore, MD, and is the manager of PRSNX. Since T. Rowe Price Global Multi-Sector Bond Investor made its debut in December of 2008, PRSNX has garnered more than $1.01 billion in assets. The fund's current manager, Kenneth Orchard, has been in charge of the fund since January of 2018.
Performance
Of course, investors look for strong performance in funds. This fund has delivered a 5-year annualized total return of 3.28%, 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 2.82%, 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. PRSNX's standard deviation over the past three years is 6.5% compared to the category average of 9.61%. The fund's standard deviation over the past 5 years is 5.52% compared to the category average of 8.81%. This makes the fund less volatile than its peers over the past half-decade.
This fund has a beta of 1, meaning that it is volatile than a broad market index of fixed income securities. Taking this into account, PRSNX has a negative alpha of -0.12, which measures performance on a risk-adjusted basis.
Ratings
Investors should also consider a bond's rating, which is a grade ( 'AAA' to 'D' ) given to a bond that indicates its credit quality. With this letter scale in mind, PRSNX has 28% in high quality bonds rated at least 'AA' or higher, while 35.5% are of medium quality, with ratings of 'A' to 'BBB'. The fund's junk bond component-bonds rated 'BB' or below-is at 24%, giving PRSNX an average quality of A. This means that it focuses on high quality securities.
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, PRSNX is a no load fund. It has an expense ratio of 0.64% compared to the category average of 0.89%. Looking at the fund from a cost perspective, PRSNX is actually cheaper than its peers.
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.
Bottom Line
Overall, T. Rowe Price Global Multi-Sector Bond Investor ( PRSNX ) has a low Zacks Mutual Fund rank, and in conjunction with its comparatively strong performance, average downside risk, and lower fees, this fund looks like a somewhat weak choice for investors right now.
Don't stop here for your research on Diversified Bonds funds. We also have plenty more on our site in order to help you find the best possible fund for your portfolio. Make sure to check out www.zacks.com/funds/mutual-funds for more information about the world of funds, and feel free to compare PRSNX to its peers as well for additional information. If you are more of a stock investor, make sure to also check out our Zacks Rank, and our full suite of tools we have available for novice and professional investors alike.