Price is reopening Small-Cap Value Fund 'I should have no trouble putting the money to work'

Mutual funds

November 06, 1998|By Bill Atkinson | Bill Atkinson,SUN STAFF

T. Rowe Price Associates Inc. reopened its Small-Cap Value Fund to new investors yesterday after closing it 2 1/2 years ago when it was being flooded with more money than could be prudently invested.

The Baltimore-based mutual fund company decided to reopen the fund after its assets had slipped about 30 percent, to $1.58 billion, from a high of $2.29 billion in March 1996.

Last spring, about $150 million flowed out of the fund as investors dumped small stocks in favor of blue chips. The fund's manager had to sell shares in the portfolio to meet redemptions.

"By reopening, we get some inflow," said Preston G. Athey, chairman of the fund's investment advisory committee. "I should have no trouble putting the money to work." Athey said many small stocks are at bargain prices. Relative to large-company stocks, their valuations have "reached all-time lows," he said.

The Small-Cap Value Fund invests in companies with market capitalizations typically less than $500 million, and whose stock prices have been beaten down. So far this year, the fund has returned a negative 15.2 percent. Its benchmark, the Russell 2,000, has returned a negative 9.21 percent.

Last year, the fund beat the benchmark by returning 27.92 percent, and over five years it has had an average return of 11.7 percent.

Pub Date: 11/06/98

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