Investing: The 7 best T. Rowe Price funds
BY NELLIE S. HUANG Kiplinger News Service
Monday, February 18, 2013
2/18/13 at 3:01 AM
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Price’s collaborative and collegial investing culture, combined with moderate fees, explains why so many of its more than 100 mutual funds top the charts. These seven are especially noteworthy.
-- Blue Chip Growth (symbol TRBCX). Since the fund’s 1993 launch, manager Larry Puglia has beaten the stock market by buying large, growing companies at reasonable prices. Lately, the fund has been on a tear. Apple, the fund’s top holding, has helped, despite the stock’s recent pullback. But four other stocks among the fund’s top ten holdings were also big gainers over the past year.
-- Capital Appreciation (PRWCX). Capital Appreciation, a balanced fund, delivers good growth with a steadiness that calms risk-averse investors. On the stock side (about 60 percent of assets), manager David Giroux can invest in companies of any size. On the fixed-income side, Giroux holds mostly high-yield bonds.
-- Emerging Markets Stock (PRMSX). Manager Gonzalo Pangaro is betting big on the growth of the middle-class consumer in developing nations. Two South Korean firms that benefit from this theme -- Samsung Electronics and LG Household & Health Care -- are the fund’s top holdings.
-- Health Sciences (PRHSX). Manager Kris Jenner has a knack for finding small companies with promising futures. For the purpose of analyzing health stocks, Jenner, a former doctor, divides the sector into two buckets: therapeutic companies, which make drugs or devices, and service companies, such as insurers and dialysis providers.
-- Media & Telecommunications (PRMTX). Manager Dan Martino maintains a portfolio of 50 to 60 stocks. Half of the fund’s assets are in stable, attractively priced companies with durable businesses, including cable-service companies, wireless-service providers and wireless-tower companies. The other half is in fast-growing media and tech firms.
-- New Horizons (PRNHX). Henry Ellenbogen has proved adept at managing this huge fund, which focuses on small companies. He hands over slices of the $9.6 billion portfolio to Kris Jenner, manager of Health Sciences Fund, and to Michael Sola, a tech analyst. Ellenbogen will hold on to a good investment even as it grows, and as a result the average holding has a market value of $2.3 billion -- hardly small. But the larger companies add stability: New Horizons has been 10 percent less volatile than the typical small-company fund.
-- Small-Cap Value Manager (PRSVX). Preston Athey favors undiscovered companies, and when he buys, he holds. The fund, a member of the Kiplinger 25, has a turnover ratio of just 6 percent, implying that Athey holds a stock for an average of 16 to 17 years. Come June 2014, Athey will retire and J. David Wagner, the fund’s associate manager since 2005, will take over.
Nellie S. Huang is a senior associate editor at Kiplinger’s Personal Finance magazine. To send her a question or comment, go to tulsaworld.com/kiplingerfeedback.
