T. Rowe Price active investing approach: More return. More often.
Our holistic perspective identifies investment ideas that have resulted in outperformance for our clients.
What is active management?
Active management involves making informed decisions based on extensive research, expert insights, and market analysis with the ultimate goal of beating the index returns. Passive management is focused on matching, not beating, the returns of the index.
Our active management strives for better results for our clients
Expertise
Our research professionals have experience investing through multiple market cycles. They are experts in specific sectors, regions, and asset classes and have the freedom to seek out investment opportunities wherever they may be.
Collaborative culture
We have a culture of shared success. Our investment professionals challenge each other's thinking—debating and examining insights from every angle to help make better decisions.
Information edge
Our rigorous research process and creative thinking provide a more comprehensive view of the investable universe, which informs how we balance risk and reward so portfolios are positioned for long-term success.
More return. More often. That’s the T. Rowe Price difference.
Ten-year periods, rolled monthly, over the 20 years ended December 31, 2024
T. Rowe Price funds beat comparable passive funds more frequently—and with higher returns—than the average of all active managers, including the largest ones.
Past performance is no guarantee of future results.
Ten-year periods, rolled monthly, over the 20 years ended December 31, 2024
This outperformance stemmed from our experience and commitment to rigorous global research, which allowed us to uncover equity investment opportunities with long-term growth potential.
Past performance is no guarantee of future results.
Ten-year periods, rolled monthly, over the 20 years ended December 31, 2024
Our fixed income funds had 0.2% less volatility than comparable passive funds. Our active management approach provided clients with a smoother ride—and a 0.2% better return—even after considering expenses.
Past performance is no guarantee of future results.
Ten-year periods, rolled monthly, over the 20 years ended December 31, 2024
Our Retirement Funds have delivered higher returns than comparable passive funds in every 10-year monthly rolling period over the last twenty years. On average, our funds outperformed by 1.11% annually. This kind of extra return can compound over time and may lead to higher retirement balances.
Past performance is no guarantee of future results.
T. Rowe Price's active management approach has delivered better returns
A long-term approach built on rigorous research and independent thinking can lead to powerful insights and better decisions. In this video, see how this enables us to deliver more for clients—and what makes our approach different.
More return. More often.
In volatile markets and economic uncertainty, you need a trustworthy partner in the markets that seeks consistent results.
At T. Rowe Price, our active management approach is founded on
- A Long-Term Approach
- Rigorous Research
- Independent Thinking
- Experienced Risk Management
Our investment professionals are independent thinkers operating in a deeply embedded culture of collaboration.
The rigor of our research—and the dynamic exchange of perspectives through our collaborative investing culture—lead to powerful insights and better decisions.
360+ sector & regional experts
520+ investment professionals traveling the world to visit companies
15k+ meetings annually between our investment teams & firms we invest in
Daily partnership between portfolio managers & analysts around the globe
As of 12/31/2024
This partnership leads to:
- Active debate,
- More differentiated opinions,
- And synthesis of information,
Helping us understand risks and opportunities through a multifaceted lens.
Our recent study of 115 actively managed T. Rowe Price funds revealed that, on average, they delivered a higher return than passive peer funds – and at a higher level – than other active managers – net of fees and expenses.
T. Rowe Price funds across asset classes came out on top compared with passive peers and their competitors.
More return. More often. That’s the T. Rowe Price Difference.
Why our active investing approach is different
At T. Rowe Price, investment analysts are curious, independent thinkers with a passion for investing.
With diverse backgrounds—from medicine to geology—they bring unique perspectives to their work and our active management approach.
And today these insights drive their global search for investment opportunities.
They decide which ideas are worth a firsthand look by examining company and security valuations, the competitive environment, industry growth, and much more.
In the field, equity and fixed income analysts often travel together, to study companies, industry sectors, and entire economies from every angle.
They meet with senior executives, front-line employees, and industry leaders. Asking better questions. Getting a deeper understanding of worker productivity, the quality of facilities and products, and the way business gets done.
They measure a company’s effectiveness by talking with suppliers and customers.
And they sit down with legislative, regulatory and other public officials, looking for answers to seek information that could affect the future of a potential investment.
Back at the office, our analysts turn findings from site visits into actionable insights—sharing ideas and debating them, collaborating to identify opportunities that can help give clients an investment edge.
Their insights help us decide what to invest in. But the work doesn’t end there. Analysts keep a long-term view, constantly asking better questions and re-evaluating the case for, or against, an investment.
The analyst’s journey is one of the many ways we help clients reach their most important financial goals. And thrive in an evolving world.
A passion for exploration
Our expert investment analysts test and retest the case for, or against, a security. Watch how their curiosity and rigorous approach informs the analysis of future opportunities.
Explore our active management insights
Uncertainty heightens the need for active fixed income management
In a world of flux, fundamentals (and active stock picking) matter
Five rules for investing in volatile times
Putting our active management approach to work for you
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Institutional Investors / Consultants
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The performance data shown is past performance and is no guarantee or reliable indicator of future results.
All investments are subject to risk, including the possible loss of principal. Results from other time periods may differ. Active investing may have higher costs than passive investing and may underperform the broad market or passive peers with similar objectives. Passive investing may lag the performance of actively managed peers as holdings are not reallocated based on changes in market conditions or outlooks on specific securities.
For more information on the methodology of this analysis, please visit troweprice.com/complete-performance-study.
Analysis by T. Rowe Price. Comparable passive funds are (1) mutual funds and exchange-traded funds (ETFs) classified as an “index fund” in the Morningstar Direct database and (2) in the same Morningstar category as the active funds being analyzed. All Active Managers represents the actively managed (non-index fund) mutual funds and ETFs in the Morningstar Direct database, excluding those managed by T. Rowe Price. The performance of the T. Rowe Price active funds and the All Active Managers funds were compared against the comparable passive funds using 10-year rolling monthly periods from 1/1/05 to 12/31/24. The analysis was conducted at the Morningstar category level, analyzing all open-end funds and ETFs within U.S. Morningstar categories where passive funds are present. Oldest share class returns are used for analysis. Money market funds are excluded from the analysis.
All Funds
1 115 funds covering 9,303 rolling 10-year periods.
2 579 funds covering 48,375 rolling 10-year periods. The active assets under management (AUM) as of 12/31/24 across all funds considered in the analysis are aggregated, and those funds offered at any point in the analysis period by the largest five active fund managers by AUM, identified by Morningstar, other than T. Rowe Price are grouped together here. Source: Morningstar.
3 5,562 funds covering 393,259 rolling 10-year periods, excluding T. Rowe Price.
Equity Funds
1 53 funds covering 5,440 rolling 10-year periods.
2 328 funds covering 31,586 rolling 10-year periods. The active assets under management (AUM) as of 12/31/24 across all funds considered in the analysis are aggregated, and those funds offered at any point in the analysis period by the largest five active fund managers by AUM, identified by Morningstar, other than T. Rowe Price are grouped together here. Source: Morningstar.
3 3,112 funds covering 257,282 rolling 10-year periods, excluding T. Rowe Price.
Fixed Income Funds
Fixed income securities are subject to credit risk, liquidity risk, call risk, and interest rate risk. As interest rates rise, bond prices generally fall.
Volatility is measured via standard deviation, annualized and net of fees, over 10-year rolling periods from 1/1/05 to 12/31/24.
31 T. Rowe Price funds are analyzed over 2,182 rolling 10-year periods.
Target Date Funds
1 Average was time-weighted based on the percentage of total rolling performance periods provided by each Retirement Fund.
For more information on the methodology of this analysis, the full study can be accessed at troweprice.com/TDPassiveStudy.
The performance data shown is past performance and is no guarantee or reliable indicator of future results. Investment return and principal value will fluctuate so that an investor’s shares, when redeemed, may be worth more or less than their original cost. Current performance may be lower or higher than the performance data quoted. To obtain the most recent month-end performance, visit troweprice.com.
Analysis by T. Rowe Price. Source: Morningstar. The target date funds included in the combined portfolios were (1) defined as passive by Morningstar as they were listed as index-based within their Morningstar Institutional Category, and (2) with the Morningstar universe sharing the same target date as each Retirement Fund. Combined portfolios were equally weighted and based on the oldest share class of each competing passive target date fund. The Retirement 2005 Fund was excluded from the study, as it had a limited number of passive peer constituents in the Morningstar universe; the Retirement 2065 Fund was excluded due to lack of a 10-year track record.
Although in the same category, there may be material differences among target date funds, including fees, expenses, and the portfolio mix of investments. Active investing may have higher costs than passive investing and may underperform the broad market or passive peers with similar objectives. Passive investing may lag the performance of actively managed peers as holdings are not reallocated based on changes in market conditions or outlooks on specific securities. Results for other time periods will differ.
The principal value of the Retirement Funds is not guaranteed at any time, including at or after the target date, which is the approximate year an investor plans to retire (assumed to be age 65) and likely stop making new investments in the fund. If an investor plans to retire significantly earlier or later than age 65, the funds may not be an appropriate investment even if the investor is retiring on or near the target date. The funds’ allocations among a broad range of underlying T. Rowe Price stock and bond funds will change over time. The funds emphasize potential capital appreciation during the early phases of retirement asset accumulation, balance the need for appreciation with the need for income as retirement approaches, and focus on supporting an income stream over a long-term postretirement withdrawal horizon. The funds are not designed for a lump-sum redemption at the target date and do not guarantee a particular level of income. The funds maintain a substantial allocation to equities both prior to and after the target date, which can result in greater volatility over shorter time horizons.
The fund's overall level of risk will directly correspond to the risks of the underlying funds in which it invests. By investing in many underlying funds, the fund has exposure to the risks of different areas of the market, such as the inherent volatility of the equity markets, which may be increased to the extent that the fund invests in small- and mid-cap stocks. Fixed income securities involve interest rate (as rates rise, the price of a fixed income security generally falls), credit, and prepayment risks. International investments are subject to special risks, including currency fluctuations and social, economic, and political uncertainties, which could increase volatility. These risks are magnified in emerging markets. No target date fund is considered a complete retirement program, and there is no guarantee of principal invested or that any single fund will provide sufficient retirement income at or through retirement.
©2025 Morningstar, Inc. All rights reserved. The information contained herein: (1) is proprietary to Morningstar and/or its content providers; (2) may not be copied or distributed; and (3) is not warranted to be accurate, complete, or timely. Neither Morningstar nor its content providers are responsible for any damages or losses arising from any use of this information.
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