SICAV
US Smaller Companies Equity Fund
Seeks capital appreciation using both value and growth approaches.
Important Information: Read the 19/11/2020 press release regarding a proposal to launch a new investment advisor.
3YR Return Annualised
(View Total Returns)
Total Assets
(USD)
1YR Return
(View Total Returns)
Manager Tenure
Information Ratio
(5 Years)
Tracking Error
(5 Years)
Inception Date 28-Sep-2001
Performance figures calculated in USD
Strategy
U.S. equities continued their rally in the fourth quarter, with small-cap indexes posting record or near-record returns. Small-caps handily outpaced large-cap stocks, and value beat growth. During the quarter, the Russell 2500 Net 30% Index returned 27.29%, as every sector posted double-digit returns. Technology, financials, industrials, and health care were the largest contributors to performance, but energy was the best-performing sector in the period. We are optimistic about a continued economic recovery as we further develop our tool chest to fight COVID-19 and multiple vaccines are rolled out in 2021. That said, we are mindful of the many challenges that remain before we're back to a more normal environment and of the fact that market valuations are extended.
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U.S. equities generated very strong returns in the final quarter of 2020, capping a remarkably robust year for the stock market given the pandemic and related economic dislocations. In fact, most major U.S. equity indexes hit all-time highs, and the narrowly focused Dow Jones Industrial Average crossed the 30,000 mark for the first time ever. Stocks benefited from reduced political uncertainty following former Vice President Joe Biden's victory over incumbent President Donald Trump in the November 3 election. Stocks also received a major boost when some pharmaceutical and biotechnology companies reported that their coronavirus vaccines demonstrated very high efficacy rates in drug trials. By the end of the year, the Food and Drug Administration granted emergency use authorization to two different coronavirus vaccines, and the initial doses were distributed to segments of the U.S. population.
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The US Smaller Companies Equity strategy seeks to capitalize on opportunities across the broad range of the small-cap and mid-cap U.S. equity market. The portfolio has a collection of core holdings in high-quality companies we expect to compound value over time and looks for select investments in "deeper value" opportunities; companies experiencing challenge or controversy of one sort or another that the investment team believes can be resolved in a reasonable period of time. The portfolio holds a number of income-oriented, dividend growth companies, as well as a collection of high-growth investments in which the investment team believes other investors do not yet fully appreciate the companies' long-term growth potential.�Overall, the strategy remains modestly overweight the high-quality compounding companies but has been finding opportunities in materials, consumer staples, and energy.
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Since the strategy's inception over 15 years ago, it has relied upon T. Rowe Price's team of fundamental research analysts to provide unique perspective and insight on the companies they follow. Going forward, the portfolio manager will continue to work closely with this talented team of investment professionals to identify the most attractive opportunities across the full range of the small-cap and mid-cap segment of the U.S. equity market.
Investment Objective
To increase the value of its shares, over the long term, through growth in the value of its investments. The fund invests mainly in a widely diversified portfolio of stocks from smaller capitalization companies in the United States.Investment Approach
- Focus on companies within the market cap range of the Russell 2500 Index at time of purchase.
- Assess valuation using relevant sector/industry metrics — absolute and relative price to earnings, price to cash flow, and price to assets.
- Integrate fundamental research by a dedicated Small-Cap research team to discover underfollowed companies possessing clear business plans, financial flexibility, and proven management teams.
- Identification of a “value creation” catalyst is key.
- Broadly diversify holdings to manage portfolio risk profile.
- Employ a low turnover and patient trading strategy to promote full value realization.
Portfolio Construction
- 200-250 securities
- Position sizes typically range from 0.15% to 2.50%
- Primary sector weights generally vary from 0.5X to 2.0X the Russell 2500 Index weights
Performance (Class I)
Annualised Performance
| 1 YR | 3 YR Annualised |
5 YR Annualised |
10 YR Annualised |
Since Manager Inception Annualised |
|
|---|---|---|---|---|---|
| Fund % | 30.02% | 18.32% | 20.57% | 15.47% | 25.79% |
| Indicative Benchmark % | 24.96% | 10.62% | 15.59% | 11.61% | 17.51% |
| Excess Return % | 5.06% | 7.70% | 4.98% | 3.86% | 8.28% |
| 1 YR | 3 YR Annualised |
5 YR Annualised |
10 YR Annualised |
|
|---|---|---|---|---|
| Fund % | 28.82% | 18.72% | 17.80% | 15.21% |
| Indicative Benchmark % | 19.48% | 10.83% | 13.13% | 11.49% |
| Excess Return % | 9.34% | 7.89% | 4.67% | 3.72% |
Recent Performance
| Month to DateData as of 05-Mar-2021 | Quarter to DateData as of 05-Mar-2021 | Year to DateData as of 05-Mar-2021 | 1 MonthData as of 31-Jan-2021 | 3 MonthsData as of 31-Jan-2021 | |
|---|---|---|---|---|---|
| Fund % | -2.56% | 3.91% | 3.91% | 2.48% | 22.01% |
| Indicative Benchmark % | -0.38% | 8.68% | 8.68% | 2.44% | 28.10% |
| Excess Return % | -2.18% | -4.77% | -4.77% | 0.04% | -6.09% |
Past performance is not a reliable indicator of future performance. Source for fund performance: T. Rowe Price. Fund performance is calculated using the official NAV with dividends reinvested, if any. The value of an investment and any income from it can go down as well as up. Investors may get back less than the amount invested. It will be affected by changes in the exchange rate between the base currency of the fund and the subscription currency, if different. Sales charges (up to a maximum of 5% for the A Class), taxes and other locally applied costs have not been deducted and if applicable, they will reduce the performance figures.
Where the base currency of the fund differs from the share class currency, exchange rate movements may affect returns.
Index returns shown with reinvestment of dividends after the deduction of withholding taxes.
Effective 1 June 2019, the "net" version of the indicative benchmark replaced the "gross" version of the indicative benchmark. The "net" version of the indicative benchmark assumes the reinvestment of dividends after the deduction of withholding taxes applicable to the country where the dividend is paid; as such, the returns of the new benchmark are more representative of the returns experienced by investors in foreign issuers. Historical benchmark performance has been restated accordingly.
Holdings
Total
Holdings
171
Largest Top Contributor^
Proofpoint
By 0.04%Largest Top Detractor^
Domino's Pizza
By -0.01%Top Purchase
Domino's Pizza
0.99%Top Sale
Dunkin Brands (E)
0.00%
Sectors
Total
Sectors
11
Top Contributor^
Financials
Net Contribution 0.31%Top Detractor^
Industrials & Business Services
Net Contribution -1.66%Largest Overweight
Industrials & Business Services
Largest Underweight
Consumer Discretionary
Team (As of 25-Feb-2021)
Curt Organt is the portfolio manager of the US Smaller Companies Equity Strategy and an associate portfolio manager of the US Small-Cap Core Equity Strategy in the U.S. Equity Division. Curt is a vice president and an Investment Advisory Committee member of the US Small-Cap Core Equity, US Diversified Small-Cap Value Equity, and US Small-Cap Growth Equity Strategies. He also is a vice president of T. Rowe Price Group, Inc.
Curt’s investment experience began in 1993, and he has been with T. Rowe Price since 1995, beginning in the U.S. Equity Division. Prior to this, Curt was employed by DAP Products, Inc., as a financial and marketing analyst.
Curt earned a B.S. in finance and philosophy from LaSalle University and an M.B.A. from Wake Forest University. Curt also has earned the Chartered Financial Analyst® designation.
CFA® and Chartered Financial Analyst® are registered trademarks owned by CFA Institute.
- Fund manager2019
since - Years at25
T. Rowe Price - Years investment29
experience
Eric Papesh is a portfolio specialist based in London in the U.S. Equity Division. Eric supports the US Smaller Companies Equity and US Large-Cap Equity Income Strategies offered in the Europe, Middle East, and Africa and Asia-Pacific regions. Eric is a vice president of T. Rowe Price Group, Inc., and T. Rowe Price International Ltd.
Eric’s investment experience began in 1994, and he has been with T. Rowe Price since 2014, beginning in the ISG division as a portfolio specialist. Prior to this, Eric was employed by Russell Investments where he focused on U.S. equity investment strategies.
Eric earned a B.A. in business administration, with concentrations in finance and information systems, and an M.B.A. in business administration from the University of Washington. Eric has earned the Chartered Financial Analyst® designation.
CFA® and Chartered Financial Analyst® are registered trademarks owned by CFA Institute.
- Years at6
T. Rowe Price - Years investment26
experience
Fee Schedule
| Share Class | Minimum Initial Investment and Holding Amount (USD) | Minimum Subsequent Investment (USD) | Minimum Redemption Amount (USD) | Sales Charge (up to) | Investment Management Fee (up to) | Ongoing Charges |
|---|---|---|---|---|---|---|
| Class A | $1,000 | $100 | $100 | 5.00% | 160 basis points | 1.68% |
| Class I | $2,500,000 | $100,000 | $0 | 0.00% | 95 basis points | 0.99% |
| Class Q | $1,000 | $100 | $100 | 0.00% | 95 basis points | 1.04% |
| Class S | $10,000,000 | $0 | $0 | 0.00% | 0 basis points | 0.04% |
Please note that the Ongoing Charges figure is inclusive of the Investment Management Fee and is charged per annum.
Curt Organt is the portfolio manager of the US Smaller Companies Equity Strategy and an associate portfolio manager of the US Small-Cap Core Equity Strategy in the U.S. Equity Division. Curt is a vice president and an Investment Advisory Committee member of the US Small-Cap Core Equity, US Diversified Small-Cap Value Equity, and US Small-Cap Growth Equity Strategies. He also is a vice president of T. Rowe Price Group, Inc.