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Giroux' second act? Interesting reading -- definitely worth keeping an eye on, thanks for posting the announcement. I hold PRWCX and been very pleased w/it ... though this looks to be the opposite of it, being more debt/FI-heavy than equity heavy. Maybe PRWCX and this will be TRP's version of VWELX/VWINX?
I see that the share-class most of us would buy into ("Investor" class) comes with a hard-dollar amount of $20.00 FEE, on top of the standard E.R. TRP does this with some other new-ish funds, already. Which is why I won't touch them. Double-dipping. Sucks big-time.
TRP does this with virtually all funds, including funds mentioned favorably at MFO such as PRWCX which you own (prospectus) and PRHSX (prospectus).
T. Rowe Price charges an annual account service fee to help offset the relatively higher costs associated with servicing lower balance accounts. Accounts with low balances result in a disproportionate amount of service in relation to the amount of the investment, and this fee helps apportion some of the operating cost more equitably within a fund.
You don't get charged this fee if you waive paper delivery of documents or invest more than $10K. If you're going to inflict disproportionately high costs on a fund and won't meet it half way by accepting electronic delivery then it is fair to expect you to pay for some of those costs.
Even though TRP is a good firm. It comes down to the fact they are losing customers to the lower cost index funds and ETFs. Something has to give and that include nickeled and dimed the fee structures.
At one point, one can gain access to M* X-ray portfolio by registering with TRP. Today one must have $250K invested with them to maintain this privilege.
Principal Investment Strategies The fund normally invests 45-75% of its net assets in fixed income and other debt instruments, including corporate and government bonds, mortgage- and asset-backed securities, and bank loans (which represent an interest in amounts owed by a borrower to a syndicate of lenders). The fund normally invests 25-55% of its net assets in common stocks and other equity securities, and may invest up to 15% of its net assets in preferred stocks and convertible securities. The fund also uses derivatives and invests in foreign securities, including emerging markets securities.
Only new investors. Existing investors were grandfathered - according to a grandfathered poster in a M* thread.
At one time you could buy lots of funds with $1K min. Very few around these days (though Schwab is trying to buck the trend). Now, $2.5K or so is typical (2.5x) Inflation hits everything.
TRP does this with virtually all funds, including funds mentioned favorably at MFO such as PRWCX which you own (prospectus) and PRHSX (prospectus).
T. Rowe Price charges an annual account service fee to help offset the relatively higher costs associated with servicing lower balance accounts. Accounts with low balances result in a disproportionate amount of service in relation to the amount of the investment, and this fee helps apportion some of the operating cost more equitably within a fund.
You don't get charged this fee if you waive paper delivery of documents or invest more than $10K. If you're going to inflict disproportionately high costs on a fund and won't meet it half way by accepting electronic delivery then it is fair to expect you to pay for some of those costs.
******************************************* ...That's why I don't see the $20.00 extortion fee? Because I've got more than $10k invested in PRWCX? News to me. If various costs go up, why throw that onto the investor? The investor gives the fund money, by which the fund makes money. They've got a much bigger pile than myself. I take e-delivery of paperwork, but they still, by law, I believe. must send required tax documents by paper-mail.... Anyway, I swallow hard and accept e-delivery because I don't like to be extorted from...
not sure why this will beat VWINX, but the thing that makes me very nervous about all these bond heavy hybrids is their long term stellar record is based on the great Bond Bull market.
Paying 4 to 6% in the past, bonds truly functioned as ballast or protection during equity declines... Now not so much at 2%, especially if the equity swoon occurs because of rising inflation... Then what? If a manger tries to get that 4 to 6% now it will be in floating rates, emerging markets and high yield that will likely join the equities on the way down...Cash may not be trash after all
It's not the same Price I first invested with sometime between 1990 and 1995. Too d** many funds now days if you ask me. Not sure what they offered back than. I'll make a (probably incorrect) guess that it was around 30-40 funds in the '90-'95 period (not counting different share classes). Back than PRFDX was in large part their claim to fame. Around that period PRWCX was hatched. And it played second fiddle to the much larger PRFDX for a decade or longer.
I realize they need to stay competitive with their peers and so need to provide lots of choices and attract more and more assets. Also, that there's some practical limitation to how much $$ a manager wants to manage inside one fund. Haven't had a chance to delve into this latest offering. But all the comments here sound interesting and thought provoking. Doesn't sound like a fund I'd be interested in adding to my established mix.
Price is a class act in a lot of ways - customer service and integrity among them. The $20 fee used to pertain to accounts a lot smaller than it does now. Seems to me the magic number was once $5,000. In recent years that jumped to $10,000 or $20,000. Not a problem. If you keep a relatively modest $50,000 under their umbrella or go to paper statements only (as msf and others have noted) they waive the fees.
It's not the same Price I first invested with sometime between 1990 and 1995. Too d** many funds now days if you ask me. Not sure what they offered back than. I'll make a (probably incorrect) guess that it was around 30-40 funds in the '90-'95 period (not counting different share classes). Back than PRFDX was in large part their claim to fame. Around that period PRWCX was hatched. And it played second fiddle to the much larger PRFDX for a decade or longer.
Not too far off. M* shows 53 distinct funds that began no later than 12/31/95. About 1/3 of the number of funds they have now (155, again from M*).
Though PRWCX was "hatched" a mere 8 months after PRFDX (6/30/86 vs. 10/31/85). At the end of 1994 PRFDX had $3.2B AUM, while PRWCX had "merely" $655M. (Data from 1995 prospectuses.)
Price had other claims to fame as well at the time, including PRNHX, then (and for another 15 years) managed by Laporte. At the end of 1994, The (then) small cap fund had $1.6B AUM.
FWIW saying I don't think charging $20 fees on accounts under 10K is a horrific thing or TRP being greedy. If anything, it helps encourage people to build longer-term positions and not trade in/out of funds quickly, generate needless churn/paperwork, etc..all of which does cost money anyway, remember. Now, by contrast, if they also charged 12(b)-1 fees and/or insane ERs, then yes, I'd agree it could be a case of pure greed.
That said I still think TRP is one of the better fund companies out there in terms of offerings, investment views, and shareholder experiences.
Though PRWCX was "hatched" a mere 8 months after PRFDX (6/30/86 vs. 10/31/85). At the end of 1994 PRFDX had $3.2B AUM, while PRWCX had "merely" $655M.
Thanks for the documentation msf. I find the closeness of inception dates (PRFDX, PRWCX) surprising.
When I mentioned integrity, one of the attributes I've found with Price is that they do a nice job explaining their funds and the type of investors who might benefit. If anything, they'll probably over-state risk rather than lull someone into owning one of their funds who shouldn't. That practice hasn't changed over the years.
I recall that they presented both PRFDX and PRWCX in the mid-90s as relatively "safe" ways to gain equity exposure. But their presentation regarding PRWCX seemed more subdued / conservative then than now. Not sure if the fund has evolved into a more aggressive fund or whether they're simply being more cautious now due to its popularity. Today, PRWCX ($28.6 Bil) is closed, while PRFDX ($21.7 Bil) remains open to new investors. (numbers from Lipper).
Comments
You don't get charged this fee if you waive paper delivery of documents or invest more than $10K. If you're going to inflict disproportionately high costs on a fund and won't meet it half way by accepting electronic delivery then it is fair to expect you to pay for some of those costs.
At one point, one can gain access to M* X-ray portfolio by registering with TRP. Today one must have $250K invested with them to maintain this privilege.
Principal Investment Strategies The fund normally invests 45-75% of its net assets in fixed income and other debt instruments, including corporate and government bonds, mortgage- and asset-backed securities, and bank loans (which represent an interest in amounts owed by a borrower to a syndicate of lenders). The fund normally invests 25-55% of its net assets in common stocks and other equity securities, and may invest up to 15% of its net assets in preferred stocks and convertible securities. The fund also uses derivatives and invests in foreign securities, including emerging markets securities.
At one time you could buy lots of funds with $1K min. Very few around these days (though Schwab is trying to buck the trend). Now, $2.5K or so is typical (2.5x) Inflation hits everything.
...That's why I don't see the $20.00 extortion fee? Because I've got more than $10k invested in PRWCX? News to me. If various costs go up, why throw that onto the investor? The investor gives the fund money, by which the fund makes money. They've got a much bigger pile than myself. I take e-delivery of paperwork, but they still, by law, I believe. must send required tax documents by paper-mail.... Anyway, I swallow hard and accept e-delivery because I don't like to be extorted from...
Paying 4 to 6% in the past, bonds truly functioned as ballast or protection during equity declines... Now not so much at 2%, especially if the equity swoon occurs because of rising inflation... Then what? If a manger tries to get that 4 to 6% now it will be in floating rates, emerging markets and high yield that will likely join the equities on the way down...Cash may not be trash after all
I realize they need to stay competitive with their peers and so need to provide lots of choices and attract more and more assets. Also, that there's some practical limitation to how much $$ a manager wants to manage inside one fund. Haven't had a chance to delve into this latest offering. But all the comments here sound interesting and thought provoking. Doesn't sound like a fund I'd be interested in adding to my established mix.
Price is a class act in a lot of ways - customer service and integrity among them. The $20 fee used to pertain to accounts a lot smaller than it does now. Seems to me the magic number was once $5,000. In recent years that jumped to $10,000 or $20,000. Not a problem. If you keep a relatively modest $50,000 under their umbrella or go to paper statements only (as msf and others have noted) they waive the fees.
Though PRWCX was "hatched" a mere 8 months after PRFDX (6/30/86 vs. 10/31/85). At the end of 1994 PRFDX had $3.2B AUM, while PRWCX had "merely" $655M. (Data from 1995 prospectuses.)
Price had other claims to fame as well at the time, including PRNHX, then (and for another 15 years) managed by Laporte. At the end of 1994, The (then) small cap fund had $1.6B AUM.
FWIW saying I don't think charging $20 fees on accounts under 10K is a horrific thing or TRP being greedy. If anything, it helps encourage people to build longer-term positions and not trade in/out of funds quickly, generate needless churn/paperwork, etc..all of which does cost money anyway, remember. Now, by contrast, if they also charged 12(b)-1 fees and/or insane ERs, then yes, I'd agree it could be a case of pure greed.
That said I still think TRP is one of the better fund companies out there in terms of offerings, investment views, and shareholder experiences.
When I mentioned integrity, one of the attributes I've found with Price is that they do a nice job explaining their funds and the type of investors who might benefit. If anything, they'll probably over-state risk rather than lull someone into owning one of their funds who shouldn't. That practice hasn't changed over the years.
I recall that they presented both PRFDX and PRWCX in the mid-90s as relatively "safe" ways to gain equity exposure. But their presentation regarding PRWCX seemed more subdued / conservative then than now. Not sure if the fund has evolved into a more aggressive fund or whether they're simply being more cautious now due to its popularity. Today, PRWCX ($28.6 Bil) is closed, while PRFDX ($21.7 Bil) remains open to new investors. (numbers from Lipper).