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SICAV

US Large Cap Growth Equity Fund

Seeking to identify investments with the potential to deliver double-digit earnings growth.

ISIN LU0174119775 Bloomberg TRPLGEI:LX

3YR Return Annualised
(View Total Returns)

Total Assets
(USD)

15.83%
$2.2b

1YR Return
(View Total Returns)

Manager Tenure

5.04%
3yrs

Information Ratio
(5 Years)

Tracking Error
(5 Years)

0.09
6.48%

Inception Date 31-Jul-2003

Performance figures calculated in USD

Other Literature

29-Feb-2020 - Taymour Tamaddon, Portfolio Manager,
Overall, we are cautious but optimistic that positive factors are still in place to support the market, while more volatile conditions could produce attractive buying opportunities for long-term investors. However, the coronavirus outbreak, global trade, and interest rates remain key market factors to watch. Furthermore, as the U.S. presidential election campaigns gain momentum and controversial policy issues are debated, the risk from political headlines on investor sentiment may become more of a concern.
Taymour Tamaddon
Taymour Tamaddon, Lead Portfolio Manager

Taymour Tamaddon is the portfolio manager of the US Large-Cap Growth Equity Strategy in the U.S. Equity Division of T. Rowe Price. Mr. Tamaddon also is a vice president and a member of the Investment Advisory Committees for the Health Sciences, New America Growth, Growth Stock, Blue Chip Growth, and Capital Appreciation Strategies. He is a vice president of the T. Rowe Price Institutional International Funds, Inc., and the T. Rowe Price International Funds, Inc. Mr. Tamaddon also is a vice president of T. Rowe Price Group, Inc.

Click for Manager Outlook
 

Strategy

Manager's Outlook

Overall, we are cautious but optimistic that sufficient market drivers are still in place and think more volatile market conditions could produce potentially attractive buying opportunities for long-term investors. However, with all the fits and starts, trade and interest rates remain the two key market factors to watch. Furthermore, as the U.S. presidential election campaigns gain momentum and controversial policy issues are debated, political headline risk may become more of a concern.

In this environment, we will continue to rely on our expertise to navigate the market, focusing on investing in high-quality companies. Leveraging the rigorous research and unique insights from our talented analyst platform gives us an important edge as we sift through the noise and identify companies with attractive growth prospects.

As always, we maintain a disciplined adherence to our rigorous process, which is rooted in bottom-up, fundamental research. In addition to uncovering underappreciated idiosyncratic stories, this approach also helps prepare us to take advantage of the market's tendency to overshoot on both the downside and the upside. Potential market overreactions often provide opportunities to trim positions into strength and add to our highest-conviction ideas on weakness.

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 diversified portfolio of stocks from large capitalization companies in the United States that have the potential for above-average and sustainable rates of earnings growth.

Investment Approach

  • Scrutinize both company and industry- level fundamentals to identify companies with characteristics that support sustainable double-digit earnings growth.
  • Focus on high-quality earnings, strong free cash flow growth, shareholder-oriented management, and rational competitive environments.
  • Exploit differences between secular and cyclical trends.
  • Limit portfolio holdings to the most attractive growth opportunities across industries.

Portfolio Construction

  • Typically 60-75 stock portfolio
  • Individual position sizes typically range +/- 1.00% to 4.00% relative to Russell 1000 Growth Index
  • Sector weights will vary from 0.5X to 3.0X for primary sectors relative to Russell 1000 Growth Index

Performance (Class I)

Annualised Performance

  1 YR 3 YR
Annualised
5 YR
Annualised
10 YR
Annualised
Since Manager Inception
Annualised
Fund % 5.04% 15.83% 12.53% 15.31% 18.00%
Indicative Benchmark % 14.69% 15.23% 11.94% 14.27% 17.07%
Excess Return % -9.65% 0.60% 0.59% 1.04% 0.93%

Inception Date 31-Jul-2003

Manager Inception Date 31-Dec-2016

Indicative Benchmark: Russell 1000 Growth Net 30% Index

Data as of  29-Feb-2020

Performance figures calculated in USD

  1 YR 3 YR
Annualised
5 YR
Annualised
10 YR
Annualised
Fund % 28.52% 21.85% 15.49% 15.55%
Indicative Benchmark % 35.88% 20.01% 14.14% 14.70%
Excess Return % -7.36% 1.84% 1.35% 0.85%

Inception Date 31-Jul-2003

Indicative Benchmark: Russell 1000 Growth Net 30% Index

Data as of  31-Dec-2019

Performance figures calculated in USD

Recent Performance

  Month to DateData as of 31-Mar-2020 Quarter to DateData as of 31-Mar-2020 Year to DateData as of 31-Mar-2020 1 MonthData as of 29-Feb-2020 3 MonthsData as of 29-Feb-2020
Fund % -7.35% -13.57% -13.57% -10.07% -5.06%
Indicative Benchmark % -9.87% -14.18% -14.18% -6.85% -1.93%
Excess Return % 2.52% 0.61% 0.61% -3.22% -3.13%

Inception Date 31-Jul-2003

Indicative Benchmark: Russell 1000 Growth Net 30% Index

Indicative Benchmark: Russell 1000 Growth Net 30% Index

Performance figures calculated in USD

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.

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.

29-Feb-2020 - Taymour Tamaddon, Portfolio Manager,
U.S. stocks fell sharply in February, as fears over the coronavirus outbreak caused steep declines over the last six trading days of the month. Within the portfolio, the health care sector dragged the most from relative returns due to adverse stock selection, particularly within the health care equipment and supplies and biotechnology industries. On the positive side, stock picks in the communication services sector boosted relative results. For example, shares of Tencent Holdings rose as the company was seen by investors as a potential beneficiary from the coronavirus outbreak. With Chinese colleges postponing the start of the new school year and college students being the top user group for the company, games like Honor of Kings led charts. Overall, we feel Tencent is the best positioned company in Chinese mobile internet, with ample opportunity to further monetise its large, rapidly growing user base. Stock choices in the information technology (IT) sector also contributed to relative returns. An underweight to Apple added to relative results as shares plunged during the month due to the global spread of the coronavirus. The company is among the most exposed American companies in China, the epicentre of the virus, and relies on the region for assembly and sales.

Holdings

Total
Holdings
65
Largest Holding Microsoft 7.74% Was (30-Sep-2019) 7.36%
Other View Full Holdings Quarterly data as of 31-Dec-2019
Top 10 Holdings 52.02% View Top 10 Holdings Monthly data as of 29-Feb-2020

Largest Top Contributor^

Alphabet
By 0.58%
% of fund 8.32%

Largest Top Detractor^

Boeing
By -2.19%
% of fund 4.37%

^Absolute

Quarterly Data as of 31-Dec-2019

Top Purchase

Apple
3.37%
Was (30-Sep-2019) 1.92%

Top Sale

Charles Schwab
0.64%
Was (30-Sep-2019) 1.50%

Quarterly Data as of 31-Dec-2019

31-Dec-2019 - Taymour Tamaddon, Portfolio Manager,

Innovation, technological change, and automation continue to disrupt a growing number of global industries, and we expect this dynamic to continue in 2020. Overall, we continue to favor many of our high-conviction holdings in the information technology and consumer discretionary sectors, where valuations still look relatively compelling given the trajectories of the underlying businesses.

Information Technology

Disruptive business models and technologies within the sector continue to present compelling investment opportunities. Secular demand for public cloud computing services continues to be a growth driver in the segment. We also continue to favor companies driven by the convergence of communications and computing, including internet software companies, and those that will benefit from broad global tailwinds in digital payments.

  • We bought shares of Apple during the quarter as we sought to narrow our relative underweight position ahead of the anticipated 2020 5G wireless product cycle, which could be supportive of share prices moving higher. However, we still maintain a significant underweight relative to the benchmark due to worries over the saturation and elongation of replacement cycles for smartphones, as well as concerns that Apple may not be able to expand its services business enough to move the needle and help sustain high levels of growth.
  • We sold shares of Temenos, a provider of core back-end software to the banking industry. We think smaller regional banks, which are Temenos's end market, are likely to pull back their IT spending in 2020, which could hurt the firm's growth prospects; therefore, we chose to reduce our position in the company.

Consumer Discretionary

We have a sizable position in the consumer discretionary sector and are constructive on stock-specific opportunities within the sector. We are focused on businesses benefiting from the secular shift of consumer spending to online retail, as well as companies positioned to take advantage of the long-term growth in online travel services.

  • We added shares of Lululemon, a leading designer, distributor, and retailer of healthy lifestyle-inspired athletic apparel. We like the near- and long-term outlook for the company as it continues to gain market share in a secularly growing industry and has strengthening competitive positioning. We also think the company has a long list of tangible growth drivers that could support future expansion, including a long growth runway in both China and Europe.
  • Shares of fast food giant McDonald's generated strong returns in 2019 due to successful sales and digital initiatives as well as positive comparable sales. After the runup in stock price, we sold shares and redeployed the proceeds to fund more compelling opportunities.

Health Care

We remain focused on finding opportunities in the health care sector that can take advantage of lasting trends, such as managed care industry consolidation, innovations in medical equipment, and robotic technology. In therapeutics, our emphasis is on select companies that have strong fundamentals and the potential to bring additional new drugs to market in areas with large, unmet clinical needs.

  • We added shares of UnitedHealth Group during the quarter after the overhang created by Democratic presidential candidates on the broader managed care industry was mitigated, largely due to Elizabeth Warren's revelation that she would not force a single-payer health care system through the budget reconciliation process, effectively lowering the probability of health care reform should she be elected.
  • Shares of Anthem sold off after the company reported quarterly results with a modestly higher-than-expected medical loss ratio due to continued medical cost pressure in certain Medicaid states. Increasing election-related rhetoric on potential health care reform also weighed on the stock. Given the near-term uncertainties, we trimmed our position during the quarter.

Sectors

Total
Sectors
9
Largest Sector Information Technology 33.86% Was (31-Jan-2020) 33.95%
Other View complete Sector Diversification

Monthly Data as of 29-Feb-2020

Indicative Benchmark: Russell 1000 Growth Index

Top Contributor^

Communication Services
Net Contribution 0.39%
Sector
-0.00%
Selection 0.39%

Top Detractor^

Information Technology
Net Contribution -0.93%
Sector
-0.24%
Selection
-0.69%

^Relative

Quarterly Data as of 31-Dec-2019

Largest Overweight

Communication Services
By9.95%
Fund 21.86%
Indicative Benchmark 11.91%

Largest Underweight

Information Technology
By-5.76%
Fund 33.86%
Indicative Benchmark 39.62%

Monthly Data as of 29-Feb-2020

29-Feb-2020 - Taymour Tamaddon, Portfolio Manager,
Overall, we continue to favour many of our high-conviction holdings in the IT and consumer discretionary sectors, where valuations still look relatively compelling given the trajectories of their underlying businesses. As always, we maintain a disciplined adherence to our rigorous process, which is rooted in bottom-up, fundamental research. In addition to uncovering underappreciated idiosyncratic stories, this approach also helps prepare us to take advantage of the market’s tendency to overshoot on both the downside and the upside.

Team (As of 31-Mar-2020)

Taymour Tamaddon

Taymour Tamaddon is the portfolio manager of the US Large-Cap Growth Equity Strategy in the U.S. Equity Division of T. Rowe Price. Mr. Tamaddon also is a vice president and a member of the Investment Advisory Committees for the Health Sciences, New America Growth, Growth Stock, Blue Chip Growth, and Capital Appreciation Strategies. He is a vice president of the T. Rowe Price Institutional International Funds, Inc., and the T. Rowe Price International Funds, Inc. Mr. Tamaddon also is a vice president of T. Rowe Price Group, Inc.

Mr. Tamaddon has 16 years of investment experience, 15 of which have been with T. Rowe Price. He joined the firm in 2004 after serving as a summer intern with T. Rowe Price in 2003, covering the eye care industry. Prior to this, Mr. Tamaddon was employed by Amazon.com in the areas of finance and merchandising. He also was a consultant with Booz Allen Hamilton, specializing in the energy industry.

Mr. Tamaddon earned a B.S., cum laude, in applied physics from Cornell University. He also earned an M.B.A., with high distinction, from the Tuck School of Business at Dartmouth, where he was an Edward Tuck Scholar. Mr. Tamaddon also has earned the Chartered Financial Analyst designation.

  • Fund manager
    since
    2017
  • Years at
    T. Rowe Price
    15
  • Years investment
    experience
    16
Larry Puglia

Larry J. Puglia is a portfolio manager in the U.S. Equity Division of T. Rowe Price. He is president of the Investment Advisory Committee of the US Large-Cap Core Growth Equity Strategy. He has been managing the US Large-Cap Core Growth Equity Strategy since 1993 and has had lead responsibility for all institutional accounts and other investment products within the strategy since 1997. Mr. Puglia is a vice president of T. Rowe Price Group, Inc.

Mr. Puglia has 30 years of investment experience, 29 of which have been with T. Rowe Price. He joined the firm in 1990 as an investment analyst specializing in financial services stocks. His coverage included banking, consumer finance, brokerage, investment management, and diversified financial companies. Mr. Puglia also served as an investment analyst covering the pharmaceutical industry. He began his career at Peat Marwick Main & Co. in 1982, ultimately serving as a senior manager.

Mr. Puglia earned a B.B.A., summa cum laude, in accounting from the University of Notre Dame and an M.B.A. in finance from the University of Virginia, Darden School of Business, where he was named a Shermet Scholar. He has earned the Chartered Financial Analyst designation and is a certified public accountant.

  • Years at
    T. Rowe Price
    29
  • Years investment
    experience
    30
Joseph Fath

Joe Fath is the portfolio manager for the US Growth Stock Strategy and is a member of the portfolio management team for the US Large-Cap Growth Equity Strategy in the U.S. Equity Division. He is a member of the U.S. Equity Steering Committee. Mr. Fath is a vice president of T. Rowe Price Group, Inc., and T. Rowe Price Associates, Inc.

Mr. Fath has 19 years of investment experience, 17 of which have been with T. Rowe Price. He joined the firm in 2002 as an analyst covering gaming, lodging, cruise lines, airlines, and air freight and logistics companies after serving as a summer intern for the firm in 2001. Mr. Fath was also the chief financial officer and cofounder of Broadform, Inc., a start-up educational/software company. In addition, he worked as director of operations analysis for Players International, a multi-jurisdictional gaming operator in the United States. Mr. Fath was also employed by Coopers & Lybrand as a senior associate in the Business Assurance and Financial Advisory Services Group.

Mr. Fath earned a B.S., with honors, in accounting from the University of Illinois at Urbana-Champaign. He also earned an M.B.A., with honors, in finance and entrepreneurial management from The Wharton School, University of Pennsylvania. Mr. Fath is also a certified public accountant.

  • Years at
    T. Rowe Price
    17
  • Years investment
    experience
    19
David L. Rowlett, CFA

David Rowlett is an associate portfolio manager for the US Large-Cap Growth Equity Strategy in the U.S. Equity Division of T. Rowe Price. He is a vice president and member of the Investment Advisory Committees of the New America Growth, Blue Chip Growth, Growth Stock, and Institutional Large-Cap Core Growth Strategies. Mr. Rowlett is a vice president of T. Rowe Price Group, Inc.

Mr. Rowlett has 16 years of investment experience, 11 of which have been with T. Rowe Price. Prior to joining the firm in 2008, he was an analyst and portfolio manager for Neuberger Berman in New York.

Mr. Rowlett earned a B.B.A., cum laude, in finance from the University of Georgia and an M.B.A. from the University of North Carolina at Chapel Hill. He also has earned the Chartered Financial Analyst designation.

  • Years at
    T. Rowe Price
    11
  • Years investment
    experience
    16
Ronald Taylor

Ron Taylor is a portfolio specialist in the Equity Division of T. Rowe Price. He is a member of the US Large-Cap Growth Equity Strategy team working closely with institutional clients, consultants, and prospects. Mr. Taylor is a vice president of T. Rowe Price Group, Inc.

Mr. Taylor has 31 years of investment experience, 16 of which have been at T. Rowe Price. Prior to joining the firm in 2003, he was employed by Zurich Scudder Investments as an equity product specialist and later as the director of Institutional Client Service. Mr. Taylor also previously worked for Chancellor Capital Management as an equity product specialist and at Putnam Investments as an equity analyst and later in new business development and client service. He began his career as a high yield bond analyst at Columbia Savings & Loan.

Mr. Taylor earned a B.A. in economics from the University of California at Los Angeles and an M.B.A. from Harvard Business School.

  • Years at
    T. Rowe Price
    16
  • Years investment
    experience
    31

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 $15,000 $100 $100 5.00% 150 basis points 1.60%
Class I $2,500,000 $100,000 $0 0.00% 65 basis points 0.71%
Class J $10,000,000 $0 $0 0.00% 0 basis points 0.03%
Class Q $15,000 $100 $100 0.00% 65 basis points 0.76%

Please note that the Ongoing Charges figure is inclusive of the Investment Management Fee and is charged per annum.

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GIPS® Information

T. Rowe Price ("TRP") claims compliance with the Global Investment Performance Standards (GIPS®). TRP has been independently verified for the twenty one- year period ended June 30, 2017 by KPMG LLP. The verification report is available upon request. Verification assesses whether (1) the firm has complied with all the composite construction requirements of the GIPS standards on a firm-wide basis and (2) the firm's policies and procedures are designed to calculate and present performance in compliance with the GIPS standards. Verification does not ensure the accuracy of any specific composite presentation.

TRP is a U.S. investment management firm with various investment advisers registered with the U.S. Securities and Exchange Commission, the U.K. Financial Conduct Authority, and other regulatory bodies in various countries and holds itself out as such to potential clients for GIPS purposes. TRP further defines itself under GIPS as a discretionary investment manager providing services primarily to institutional clients with regard to various mandates, which include U.S, international, and global strategies but excluding the services of the Private Asset Management group.

A complete list and description of all of the Firm's composites and/or a presentation that adheres to the GIPS® standards are available upon request. Additional information regarding the firm's policies and procedures for calculating and reporting performance results is available upon request

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