PASUX
2065 TRPrice Retirement-Adv
Strategic Asset Allocation for Long-Term Growth
The 2065 TRPrice Retirement-Adv fund (PASUX) is designed to provide investors with a strategic asset allocation that balances growth and income, tailored for those planning to retire around the year 2065. The fund achieves this by investing in a diversified portfolio of T. Rowe Price stock and bond mutual funds, representing various asset classes and sectors. This approach allows the fund to dynamically adjust its allocation over time, aligning with the target retirement date. The fund’s asset class allocation is heavily weighted towards U.S. equities, comprising 66.25% of the portfolio, with a significant portion also invested in non-U.S. equities at 30.61%. This diversified approach aims to capture growth opportunities across global markets while maintaining a focus on long-term capital appreciation.
At A Glance
Executive Summary
PASUX offers diversified exposure with a focus on growth and income, suitable for investors targeting retirement in 2065. Competitive expense ratio of 0.89%.
Diversified portfolio across asset classes and sectors. Managed for 2065 retirement target. Strong recent performance with 28.04% 1-year return.
High expense ratio compared to some peers. Negative alpha and Sharpe ratio. Significant cash allocation may limit growth potential.
Performance Analysis: A Year of Strong Returns
In the past year, PASUX has delivered a robust performance with a 28.04% return, showcasing its potential for high returns in favorable market conditions. This performance is particularly notable when compared to its benchmark, the S&P 500 Total Return Index, which achieved a 37.62% return over the same period. While the fund’s return is slightly lower than the benchmark, it remains competitive within its category, especially considering its diversified asset allocation strategy. The fund’s performance is supported by its significant exposure to growth-oriented sectors such as technology and healthcare, which have been key drivers of returns. However, investors should be aware of the fund’s negative alpha of -9.62%, indicating that it has underperformed relative to its risk-adjusted benchmark.
Sector Allocation: Emphasizing Technology and Healthcare
PASUX’s sector allocation reflects a strategic emphasis on technology and healthcare, which together account for over 36% of the fund’s portfolio. This focus aligns with the fund’s objective of achieving long-term growth, as these sectors have historically been strong performers and are expected to continue driving innovation and economic expansion. The technology sector alone represents 22.84% of the portfolio, highlighting the fund’s commitment to capturing the growth potential of tech companies. Additionally, the healthcare sector, comprising 13.43% of the portfolio, provides exposure to companies that benefit from demographic trends and advancements in medical technology. This sector allocation strategy positions the fund to capitalize on emerging trends and opportunities in these high-growth areas.
Risk Metrics: Understanding Volatility and Drawdowns
Investors considering PASUX should be mindful of its risk metrics, which provide insight into the fund’s volatility and potential for drawdowns. The fund has a beta of 0.86, indicating lower volatility compared to the broader market, as represented by its benchmark. However, the fund’s Sharpe ratio of -0.85 and Treynor ratio of -11.24 suggest that it has not effectively compensated investors for the risks taken. The maximum drawdown of -7.7% highlights the potential for significant losses during market downturns, although the fund has demonstrated resilience with a quick recovery. These risk metrics underscore the importance of understanding the fund’s risk profile and aligning it with individual investment goals and risk tolerance.
Comparative Analysis: Expense Ratio and Peer Performance
When evaluating PASUX, it’s important to consider its expense ratio of 0.89%, which is relatively high compared to some of its peers. For instance, similar funds like the 2060 Schwab Target (SWPRX) and 2060 Nationwide Destination-IS (NWWVX) offer lower expense ratios of 0.58% and 0.68%, respectively. Despite this, PASUX’s recent performance remains competitive, with a 1-year return of 28.04%, closely matching peers such as the 2065 TRPrice Target-Adv (PAZLX) and 2060 Voya Index Solution-Adv (VPSAX). Investors should weigh the higher expense ratio against the fund’s strategic asset allocation and potential for long-term growth when making investment decisions.
Portfolio Composition: Diversification Across Holdings
PASUX’s portfolio is composed of a diverse range of holdings, with top allocations to T. Rowe Price Value Z (TRZAX) at 15.82% and T. Rowe Price Growth Stock Z (TRJZX) at 14.63%. This diversification across different T. Rowe Price funds allows PASUX to leverage the expertise and performance of various fund managers within the T. Rowe Price family. The fund’s holdings span multiple asset classes and sectors, providing a balanced approach to growth and income. This diversified composition is designed to mitigate risks associated with individual securities and sectors, while also positioning the fund to benefit from a broad array of market opportunities.
Investor Suitability: Targeting Long-Term Retirement Goals
PASUX is particularly suitable for investors who are planning for retirement around the year 2065 and are seeking a fund that offers a blend of growth and income. The fund’s strategic asset allocation and sector emphasis make it an attractive option for those looking to capitalize on long-term market trends and demographic shifts. However, potential investors should consider the fund’s higher expense ratio and risk metrics, which may not align with all risk profiles. The fund’s focus on U.S. and non-U.S. equities provides exposure to global growth opportunities, making it a compelling choice for investors with a long-term investment horizon and a moderate to high risk tolerance.
Conclusion: A Strategic Choice for Future Retirees
In conclusion, the 2065 TRPrice Retirement-Adv fund (PASUX) stands out as a strategic choice for investors targeting retirement in 2065. Its diversified portfolio, with a strong emphasis on growth sectors like technology and healthcare, positions it well for capturing long-term market opportunities. While the fund’s expense ratio is higher than some peers, its recent performance and strategic asset allocation offer compelling reasons for consideration. Investors should assess their individual risk tolerance and investment goals to determine if PASUX aligns with their retirement planning needs. Overall, PASUX offers a balanced approach to growth and income, making it a suitable option for future retirees seeking to build a robust retirement portfolio.
Similar Securities
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PCJZX: Putnam Retirement Advantage 2065 A | Target Date Fund for Future Retirees
PCJZX offers a diversified asset allocation strategy for future retirees, with a focus on income as the target date nears. Competitive expense ratio of 0.8%.
LIZAX: 2060 BlackRock LifePath IxFd-InvA | Strategic Retirement Investment
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PAZLX: 2065 TRPrice Target-Adv | Diversified Growth & Income Fund
PAZLX offers diversified exposure with a focus on growth and income, ideal for long-term retirement planning. Competitive expense ratio and strong asset allocation.
TRRYX: 2060 TRPrice Retirement-Adv | Diversified Growth & Income for 2060 Retirement
TRRYX offers a diversified portfolio with a focus on growth and income, suitable for investors targeting retirement in 2060. Competitive expense ratio of 0.89%.
Futher Reading
https://finance.yahoo.com/quote/PASUX/”>Yahoo: 2065 TRPrice Retirement-Adv
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