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GIPS® Information

T. Rowe Price ("TRP") claims compliance with the Global Investment Performance Standards (GIPS®) and has prepared and presented this report in compliance with the GIPS standards. T. Rowe Price has been independently verified for the twenty four-year period ended June 30, 2020, by KPMG LLP. The verification report is available upon request. A firm that claims compliance with the GIPS standards must establish policies and procedures for complying with all the applicable requirements of the GIPS standards. Verification provides assurance on whether the firm’s policies and procedures related to composite and pooled fund maintenance, as well as the calculation, presentation, and distribution of performance, have been designed in compliance with the GIPS standards and have been implemented on a firm-wide basis. Verification does not provide assurance on the accuracy of any specific performance report.

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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Home / Products / SICAV / US Smaller Companies Equity Fund
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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. 

ISIN LU0133096635 Bloomberg TRPSCEA:LX
View more information on risks
Factsheet
KIID
Fund ProfileFund Commentary

3YR Return Annualised
(View Total Returns)

Total Assets
(USD)

17.89%
$2.5b
Data as of 31-Dec-2020
Data as of 31-Dec-2020

1YR Return
(View Total Returns)

Manager Tenure

27.93%
1yr
Data as of 31-Dec-2020
Data as of 15-Jan-2021

Inception Date 31-Jul-2001

Performance figures calculated in USD

Other Literature

footerPhoto
31-Dec-2020 - Curt Organt, Portfolio Manager ,
We are optimistic about a continued economic recovery given the prospect of multiple vaccines being rolled out in 2021. That said, we are mindful of the many challenges that remain before we are back to a more normal environment and of the fact that market valuations are extended. Our focus remains on identifying the most attractive opportunities across the full range of the small-cap and mid-cap segment of the U.S. equity market.
Curt J. Organt, CFA
Curt J. Organt, CFA, Portfolio Manager

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.

 
  • This product's strategy also available as
  • a Strategy

Strategy

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 A)

Annualised Performance

  1 YR 3 YR
Annualised		 5 YR
Annualised		 10 YR
Annualised		 Since Manager Inception
Annualised
Fund % 27.93% 17.89% 16.98% 14.41% 24.55%
Indicative Benchmark % 19.48% 10.83% 13.13% 11.49% 16.81%
Excess Return % 8.45% 7.06% 3.85% 2.92% 7.74%

Inception Date 31-Jul-2001

Manager Inception Date 31-Mar-2019

Indicative Benchmark: Russell 2500 Net 30% Index

Data as of 31-Dec-2020

Performance figures calculated in USD

  1 YR 3 YR
Annualised		 5 YR
Annualised		 10 YR
Annualised
Fund % 27.93% 17.89% 16.98% 14.41%
Indicative Benchmark % 19.48% 10.83% 13.13% 11.49%
Excess Return % 8.45% 7.06% 3.85% 2.92%

Inception Date 31-Jul-2001

Indicative Benchmark: Russell 2500 Net 30% Index

Data as of 31-Dec-2020

Performance figures calculated in USD

Recent Performance

  Month to DateData as of 25-Jan-2021 Quarter to DateData as of 25-Jan-2021 Year to DateData as of 25-Jan-2021 1 MonthData as of 31-Dec-2020 3 MonthsData as of 31-Dec-2020
Fund % 6.15% 6.15% 6.15% 4.44% 21.06%
Indicative Benchmark % 7.03% 7.03% 7.03% 7.57% 27.29%
Excess Return % -0.88% -0.88% -0.88% -3.13% -6.23%

Inception Date 31-Jul-2001

Indicative Benchmark: Russell 2500 Net 30% Index

Indicative Benchmark: Russell 2500 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.

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.

footerPhoto
31-Dec-2020 - Curt Organt, Portfolio Manager ,
U.S. stocks continued to rise in December, capping a remarkably strong year, as most U.S. indices hit new all-time highs at various stages of the month. Stocks received a boost when two different coronavirus vaccines received emergency use authorisation from the U.S. Food and Drug Administration. At the portfolio level, our stock choices in information technology (IT) hampered relative returns. Shares of Splunk, a leading machine data analytics platform, dropped after reporting earnings that fell short of consensus estimates as several large deals expected to close this quarter were deferred. Industrials and business services also weighed on performance due to our stock picks. Conversely, financials contributed to relative returns, thanks to our stock selection. For example, shares of Pinnacle were boosted by a substantial earnings-per-share beat driven by strong fee income and a lower loan loss provision.

Holdings

Total
Holdings
171
Largest Holding Avery Dennison 1.47% Was (30-Sep-2020) 1.37%
Other View Full Holdings Quarterly data as of  31-Dec-2020
Top 10 Holdings 13.56% View Top 10 Holdings Monthly data as of  31-Dec-2020

Largest Top Contributor^

Proofpoint
By 0.04%
% of fund 1.34%

Largest Top Detractor^

Domino's Pizza
By -0.01%
% of fund 1.19%

^Absolute

Quarterly Data as of 31-Dec-2020

Top Purchase

Domino's Pizza
0.99%
Was (30-Sep-2020) 1.04%

Top Sale

Dunkin Brands (E)
0.00%
Was (30-Sep-2020) 0.68%

Quarterly Data as of 31-Dec-2020

footerPhoto
30-Sep-2020 - Curt Organt, Portfolio Manager ,

We do not make sector "bets," and sector weightings are formed as a residual of our bottom-up investment process. We used recent volatility as an opportunity to upgrade the portfolio and increase exposure to our highest-conviction companies, using funds sourced from our highest performers. During the quarter, trading activity spanned the various sectors. We've highlighted some of the larger purchases and sales occurring within information technology, health care, industrials and business services, and consumer discretionary.

Information Technology

A number of the disruptive companies that are on the right side of change are featured in the sector. We remain sanguine on the sector as a whole. The portfolio has large allocations in the software, IT services, semiconductors, and electronic equipment and instruments segments. We have been able to find many niche software providers that we believe have attractive growth opportunities and barriers to ward off their competition.

  • We initiated a position in PTC, a leading software developer for computer-aided design, product life-cycle management, and the industrial internet of things (IIoT). We believe the company has a sustainably differentiated position in the IIoT market given its domain expertise, early mover's advantage, and ability to integrate with core software.
  • We added a position in leading high-speed analog player Inphi on recent weakness attributed to the company's exposure to Huawei. We believe this to be a high-quality company that is well positioned to benefit from the increasing demand for faster data movement in the cloud and 5G.
  • Twilio has generated strong performance, boosted by an acceleration in digital platforms. We trimmed our position into strength but maintain our view that the company's rapid growth should have a long runway.

Health Care

In health care, we have a sizable allocation to equipment and supplies, providers and services, and biotechnology names. The health care segment has been a sector of controversy over recent years amid reform legislation, attempts at repeal, and the uncertainty regarding its outcomes. We have focused on investments that we feel will benefit from the environment regardless of the end result by sticking to fundamentals and a diversified approach within biotechnology to mitigate risk.

  • We initiated a position in Ionis Pharmaceuticals. The commercial-stage biotech company is built around its antisense drug discovery platform, which has markedly improved in recent years. Additionally, we believe the company's improved technology platform and transition from a partnering model to a more fully integrated biotech model should unlock substantial value over time. In our view, the company's recently announced agreement to acquire the outstanding shares of Akcea Therapeutics that it does not already own furthers that transformation.
  • We reduced Quidel following strong share price appreciation attributed to an increased focus on testing and vaccine distribution in the wake of the coronavirus pandemic.
  • Seattle Genetics, a fully integrated biotech company focused on antibody-drug conjugates for cancer, has performed well, and we exited our position early in the period on market capitalization considerations.

Industrials and Business Services

In the industrials and business services sector, the portfolio is overweight compared with the benchmark allocation due in particular to sizable positions in machinery, professional services, and road and rail. The sector tends to be cyclical, with strong surges during economic recovery. We have exposure to cyclical holdings to take advantage of economic recovery, but we also hold positions in more stalwart areas that allow steady and measured returns to provide a more balanced risk exposure.

  • We added a position in Dun & Bradstreet, a commercial database and analytics provider that went public early in the period. The company's best-in-class data are firmly entrenched in the world's largest retailers, and we have confidence in new management's initiatives to improve the business and boost product capabilities.
  • We increased our position in Clarivate, a leading provider of intellectual property and scientific information; analytical tools; and services for academia, businesses, and governments. We feel Clarivate possesses an attractive set of information services assets and that new management is well positioned to capture efficiencies and spur organic growth through new product offerings, bundling, and untapped pricing power. We have a favorable view of the company's recently announced acquisition of CPA Global, which strengthens the core intellectual property business.
  • CoStar Group provides commercial real estate data to institutions and operates two popular online listing services: Apartments.com and LoopNet. The company has been a top year-to-date performer, and the share price reached a new high during the quarter. We trimmed our position on valuation considerations but maintain a positive view of the company and its ability to drive revenue growth and margin expansion over time.

Consumer Discretionary

We are underweight the benchmark allocation within the consumer discretionary sector, where our largest allocations are to the hotels, restaurants, and leisure; specialty retail; and diversified consumer services industries. Despite our underweight, we continue to believe the sector is ripe with select names that provide attractive business models and insulated growth opportunities. Coronavirus-related pressures on the sector have created compelling investment opportunities.

  • We initiated a position in Magna International, the world's third-largest auto supplier. We believe the company is well positioned to benefit from longer-term trends in automotive manufacturing, such as growth in hybrid electric powertrains, autonomous driving, and electrification.
  • We found an attractive entry point in SeaWorld Entertainment. The company has made significant capital investments, with a focus on redefining and improving the core brand image, and we believe there is substantial room for growth.
  • Shares of National Vision Holdings, an operator of value-oriented retail vision stores, has performed well relative to specialty retail peers and we eliminated our position to fund investments with greater upside potential.

Sectors

Total
Sectors
11
Largest Sector Industrials & Business Services 21.16% Was (30-Nov-2020) 20.36%
Other View complete Sector Diversification

Monthly Data as of 31-Dec-2020

Indicative Benchmark: Russell 2500 Index

Top Contributor^

Financials
Net Contribution 0.31%
Sector
-0.15%
Selection 0.46%

Top Detractor^

Industrials & Business Services
Net Contribution -1.66%
Sector
-0.05%
Selection
-1.62%

^Relative

Quarterly Data as of 31-Dec-2020

Largest Overweight

Industrials & Business Services
By6.01%
Fund 21.16%
Indicative Benchmark 15.15%

Largest Underweight

Consumer Discretionary
By-3.59%
Fund 9.05%
Indicative Benchmark 12.63%

Monthly Data as of 31-Dec-2020

footerPhoto
31-Dec-2020 - Curt Organt, Portfolio Manager ,
Industrials and business services, IT, health care, financials, and consumer discretionary remain the dominant sectors in the portfolio, each with greater than 10% of the equity allocation. We continue to invest in select companies across various industries where we feel valuations may underestimate the sustainability of growth or turnaround potential. During the month, this included boosting our positions within equity real estate investment trusts; professional services; trading companies and distributors; and hotels, restaurants, and leisure.

Team (As of 15-Jan-2021)

Curt J. Organt, CFA

Curt J. Organt, CFA
Portfolio Manager

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 manager
    since
    2019
  • Years at
    T. Rowe Price
    25
  • Years investment
    experience
    29
Eric Papesh, CFA, BA, MBA

Eric Papesh, CFA, BA, MBA
Portfolio Specialist

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 at
    T. Rowe Price
    6
  • Years investment
    experience
    26

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.

Closed and/or capacity constrained.

Please note that the Fund typically has a risk of high volatility.

Indicative Benchmark Data Source: Russell. Frank Russell Company (“Russell”) is the source and owner of the Russell Index data contained or reflected in these materials and all trademarks and copyrights related thereto. Russell® is a registered trademark of Russell. Russell is not responsible for the formatting or configuration of this materials or for any inaccuracy in T. Rowe Price Associates’ presentation thereof.

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. 

Daily performance data is based on the latest available NAV. Performance returns for share classes less than 1 year old (and associated benchmarks) are cumulative rather than annualised.

Please note that no management fees are charged to the S and J share classes. No administration agent fees are charged to the J class. Fee arrangements for the S and J classes are made directly with the investment manager. Please see the prospectus for further information.

Effective 31 March 2019, Curt Organt assumed portfolio management responsibility for the US Smaller Companies Equity Fund.

The Funds are sub-funds of the T. Rowe Price Funds SICAV, a Luxembourg investment company with variable capital which is registered with Commission de Surveillance du Secteur Financier and which qualifies as an undertaking for collective investment in transferable securities (“UCITS”). Full details of the objectives, investment policies and risks are located in the prospectus which is available with the key investor information documents in English and in an official language of the jurisdictions in which the Funds are registered for public sale, together with the annual and semi-annual reports (together “Fund Documents”). Any decision to invest should be made on the basis of the Fund Documents which are available free of charge from the local representative, local information/paying agent or from authorised distributors and via www.troweprice.com.

Hedged share classes (denoted by 'h') utilise investment techniques to mitigate currency risk between the underlying investment currency(ies) of the fund and the currency of the hedged share class. The costs of doing so will be borne by the share class and there is no guarantee that such hedging will be effective.

Net Asset figure applies to all share classes.

Number of years managing the fund. In the case of co-portfolio management, the longer tenure is displayed.

The specific securities identified and described in this report do not represent all of the securities purchased, sold, or recommended for the sub-fund and no assumptions should be made that the securities identified and discussed were or will be profitable.

A full list of the currently issued Share Classes including Distributing, Hedged, and Accumulating Categories may be obtained, free of charge and upon request, from the registered office of the Company.