Is T. Rowe Price Blue Chip Growth Adviser (PABGX) a Strong Mutual Fund Pick Right Now?

If you’ve been stuck searching for Large Cap Growth funds, consider T. Rowe Price Blue Chip Growth Adviser (PABGX) as a possibility. PABGX holds a Zacks Mutual Fund Rank of 1 (Strong Buy), which is based on various forecasting factors like size, cost, and past performance.

We classify PABGX in the Large Cap Growth category, an area rife with potential choices. Large Cap Growth funds invest in many large U.S. companies that are expected to grow much faster compared to other large-cap stocks. To be considered large-cap, companies must have a market cap over $10 billion.

T. Rowe Price is based in Baltimore, MD, and is the manager of PABGX. T. Rowe Price Blue Chip Growth Adviser debuted in June of 1993. Since then, PABGX has accumulated assets of about $1.22 billion, according to the most recently available information. The fund’s current manager, Paul Greene, has been in charge of the fund since October of 2021.

Obviously, what investors are looking for in these funds is strong performance relative to their peers. This fund carries a 5-year annualized total return of 12.48%, and it sits in the bottom third among its category peers. If you’re interested in shorter time frames, do not dismiss looking at the fund’s 3 -year annualized total return of 15.33%, which places it in the middle 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. Over the past three years, PABGX’s standard deviation comes in at 19.74%, compared to the category average of 15.4%. Over the past 5 years, the standard deviation of the fund is 20.15% compared to the category average of 16.34%. This makes the fund more volatile than its peers over the past half-decade.

Investors should not forget about beta, an important way to measure a mutual fund’s risk compared to the market as a whole. PABGX has a 5-year beta of 1.13, which means it is likely to be more volatile than the market average. Another factor to consider is alpha, as it reflects a portfolio’s performance on a risk-adjusted basis relative to a benchmark-in this case, the S&P 500. The fund has produced a negative alpha over the past 5 years of -3.65, which shows that managers in this portfolio find it difficult to pick securities that generate better-than-benchmark returns.