T. Rowe Price Group Favors US Equity and Debt Markets
T. Rowe Price Group: A Global Investment Manager (Part 4 of 16)
US equity and fixed income markets
T. Rowe Price Group (TROW) has heavy exposure in the US equity and debt markets. US assets constitute 86% of all its assets under management, which total $746.8 billion. The remaining funds are in international equity and debt.
T. Rowe focuses mainly on local offerings, building new funds that increase concentration in the US market. Strong US markets will always be better for the company because of this exposure. US equities constitute 67% of its total assets under management. This reflects T. Rowe’s ability to attract capital for its equity mutual funds.
Retirement accounts and variable annuity
T. Rowe is big on retirement solutions because of existing growth opportunities in the segment. Retirement accounts and variable annuity portfolios constitute 68% of the company’s total assets. In this area, T. Rowe faces competition from the likes of BlackRock (BLK), Invesco (IVZ), Franklin Resources (BEN), Legg Mason (LM), and Affiliated Managers (AMG). Together, these companies make up 2.77% of the Financial Select Sector SPDR Fund (XLF).
These are T. Rowe’s major funds in this segment:
Growth Stock
Equity Income
Mid-Cap Growth
Blue-Chip Growth
Value
Capital Appreciation
These funds contributed 27% toward the company’s revenues in 2014 but represented only 23% of total assets. T. Rowe’s target-date retirement funds and trusts continue to be a significant source of asset growth. In 2014, $17.7 billion of net cash flow originated from these portfolios, including $13.2 billion from the target-date retirement funds.
Browse this series on Market Realist: