T. Rowe Price New Income Fund
The investment objective of T. Rowe Price New Income fund is to provide the highest income level with the capital preservation. This fund utilizes its assets to purchase income-producing securities. These securities may include U.S. government and agency obligations, mortgage- and asset-backed securities, corporate bonds, foreign securities, collateralized mortgage obligations, Treasury inflation protected securities. It may invest, on occasion, in equities.
Fund Profile
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| T. Rowe Price New Income |
- Fund Inception Date: August 31, 1973
- Ticker Symbol: PRCIX
- CUSIP: 779570100
- Beta (3yr): 0.88
- Rank in category (YTD): 71%
- Category: Intermediate-Term Bond
- Yield: 3.30%
- Capital Gains: 0%
- Expense Ratio: 0.59%
- Net Assets: $ 17.97 billion
- Number of Years Up: 36 years
- Number of Years Down: 2 years
- Average Maturity: 7.44 years
- Average Duration: 4.77 years
- Annual Turnover Rate: 110.70%
This T. Rowe Price fund has been in the market since 1973. It is currently managed by Daniel O. Shackleford. He started managing this fund in December 2002. This fund has quite large total net assets of $17.97 billion. The 12-month dividend yield is 3.30%. This no load Intermediate-Term Bond fund has just distributed its dividend for investors in April 30, 2012 ($0.02). The annual holdings turnover as of May 23, 2012 is 110.70%. It has annual expense ratio of 0.59%.
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Morningstar analysts rated this T. Rowe Price New Income fund with Bronze rating. The fund is given 4-stars rating for its performance of 36 years of positive return and 2 years of negative return. The YTD return of this fund is 1.98%. The best 1-year total return was recorded in 2009 with 12.31%. The performance of this fund based on its load adjusted returns was 8.17% over the past 3-year and 5.81% over the past 10-year.
The minimum initial investment needed to buy this mutual fund is $2,500 for regular brokerage account. As for retirement account, the minimum initial investment needed is $1,000. The minimum next purchase is $100. There are 87 brokerages that provide the sales of this fund besides T. Rowe Price, such as JP Morgan, Td Ameritrade Inc, Vanguard, E Trade Financial, Protected Investors of America, Fidelity Retail Funds Network, etc.
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The top sector diversification as of March 2012 is Mortgage (25.7%), Corporate (26.0%) and U.S. Treasury (14.3%). The asset allocation is Domestic Bond (86.3%), Foreign Bond (10.1%) and Cash (3.6%).
According to the fund prospectus, the principal risks in investing in this fund include: active management risk, interest rate risk, credit risk, liquidity risk, foreign investing risk, etc.
Pros:
- There is no sales load
- Good long term track record
- It has a diversified portfolio
- High portfolio turnover rate
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