Is T. Rowe Price Retirement Balanced (TRRIX) a Strong Mutual Fund Pick Right Now?

On the lookout for a Allocation Balanced fund? Starting with T. Rowe Price Retirement Balanced (TRRIX) should not be a possibility at this time. TRRIX bears a Zacks Mutual Fund Rank of 4 (Sell), which is based on various forecasting factors like size, cost, and past performance.

Objective

TRRIX is classified in the Allocation Balanced segment by Zacks, which is an area full of possibilities. Here, investors are able to get a good head start with diversified mutual funds, and play around with core holding options for a portfolio of funds. Allocation Balanced funds look to invest across a balance of asset types, like stocks, bonds, and cash, though including precious metals or commodities is not unusual; these funds are mostly categorized by their respective asset allocation.

History of Fund/Manager

TRRIX is a part of the T. Rowe Price family of funds, a company based out of Baltimore, MD. T. Rowe Price Retirement Balanced made its debut in September of 2002, and since then, TRRIX has accumulated about $943.00 million in assets, per the most up-to-date date available. The fund is currently managed by a team of investment professionals.

Performance

Investors naturally seek funds with strong performance. This fund in particular has delivered a 5-year annualized total return of 4.6%, and it sits in the bottom 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 9.88%, which places it in the bottom 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. The standard deviation of TRRIX over the past three years is 6.05% compared to the category average of 10.38%. Looking at the past 5 years, the fund's standard deviation is 7.62% compared to the category average of 12.18%. This makes the fund less volatile than its peers over the past half-decade.

Risk Factors

Investors should note that the fund has a 5-year beta of 0.45, so it is likely going to be less volatile than 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. Over the past 5 years, the fund has a negative alpha of -3.69. This means that managers in this portfolio find it difficult to pick securities that generate better-than-benchmark returns.

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, TRRIX is a no load fund. It has an expense ratio of 0.49% compared to the category average of 0.88%. Looking at the fund from a cost perspective, TRRIX is actually cheaper than its peers.

This fund requires a minimum initial investment of $2,500, and each subsequent investment should 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 weak performance, average downside risk, and lower fees, T. Rowe Price Retirement Balanced ( TRRIX ) has a low Zacks Mutual Fund rank, and therefore looks a somewhat weak choice for investors right now.

Don't stop here for your research on Allocation Balanced 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 TRRIX to its peers 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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