Is T. Rowe Price International Discovery (PRIDX) a Strong Mutual Fund Pick Right Now?

There are plenty of choices in the Non US - Equity category, but where should you start your research? Well, one fund that might be worth investigating is T. Rowe Price International Discovery (PRIDX). PRIDX bears a Zacks Mutual Fund Rank of 2 (Buy), which is based on various forecasting factors like size, cost, and past performance.

Objective

We classify PRIDX in the Non US - Equity category, which is an area rife with potential choices. Investing in companies outside the United States is how Non US - Equity funds set themselves apart, since global funds tend to keep a good portion of their portfolio stateside. Many of these funds like to allocate across emerging and developed markets, and will often focus on all cap levels.

History of Fund/Manager

T. Rowe Price is responsible for PRIDX, and the company is based out of Baltimore, MD. The T. Rowe Price International Discovery made its debut in December of 1988 and PRIDX has managed to accumulate roughly $1.88 billion in assets, as of the most recently available information. The fund's current manager is a team of investment professionals.

Performance

Investors naturally seek funds with strong performance. PRIDX has a 5-year annualized total return of 2.77%, and is in the middle third among its category peers. Investors who prefer analyzing shorter time frames should look at its 3-year annualized total return of 12.6%, 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, PRIDX's standard deviation comes in at 13.31%, compared to the category average of 11.92%. Over the past 5 years, the standard deviation of the fund is 16.25% compared to the category average of 14.2%. This makes the fund more volatile than its peers over the past half-decade.

Risk Factors

Investors should note that the fund has a 5-year beta of 0.84, so it is likely going to be less volatile than the market at large. 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. PRIDX's 5-year performance has produced a negative alpha of -8.85, which means managers in this portfolio find it difficult to pick securities that generate better-than-benchmark returns.

Expenses

As competition heats up in the mutual fund market, costs become increasingly important. Compared to its otherwise identical counterpart, a low-cost product will be an outperformer, all other things being equal. Thus, taking a closer look at cost-related metrics is vital for investors. In terms of fees, PRIDX is a no load fund. It has an expense ratio of 1.24% compared to the category average of 1.02%. PRIDX is actually more expensive than its peers when you consider factors like cost.

Investors need to be aware that with this product, the minimum initial investment is $2,500; each subsequent investment needs to 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 similar performance, average downside risk, and higher fees, T. Rowe Price International Discovery ( PRIDX ) has a high Zacks Mutual Fund rank, and therefore looks a good potential choice for investors right now.

This could just be the start of your research on PRIDX in the Non US - Equity category. Consider going to www.zacks.com/funds/mutual-funds for additional information about this fund, and all the others that we rank as well for additional information. For analysis of the rest of your portfolio, make sure to visit Zacks.com for our full suite of tools which will help you investigate all of your stocks and funds in one place.

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This article originally published on Zacks Investment Research (zacks.com).

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