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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.

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SICAV

Global Growth Equity Fund

Seeking to select superior stocks from the broadest global equity opportunity set.

ISIN LU1127969324 Bloomberg TRGGEQE:LX

3YR Return Annualised
(View Total Returns)

Total Assets
(USD)

18.64%
$574.5m

1YR Return
(View Total Returns)

Manager Tenure

29.14%
6yrs

Information Ratio
(5 Years)

Tracking Error
(5 Years)

1.53
5.08%

Inception Date 28-Oct-2014

Performance figures calculated in EUR

31-Jan-2021 - Scott Berg, Portfolio Manager,
We expect the “COVID-on”/”COVID-off” trade to continue to flip-flop back and forth as it did through the later stages of 2020. We believe secular growth stocks, at the right price, should continue to compound good returns, but the setup into midyear might imply a continuation of the rotation trade into value, small-caps, and non-U.S. stocks that began toward the end of last year. Selectivity is crucial in a world that remains defined by extreme outcomes.
Scott Berg
Scott Berg, Portfolio Manager

Scott Berg is the portfolio manager for the T. Rowe Price Global Growth Equity Strategy and a vice president of T. Rowe Price Group, Inc.

Click for Manager Outlook
 

Strategy

Manager's Outlook

Global equities advanced in the fourth quarter as investors weighed the worsening coronavirus pandemic against hopes of a potential coronavirus vaccine. As sentiment has risen, however, we believe it makes sense to be prudent in terms of portfolio positioning. To be clear, we are optimistic as we look out over one to two years, but we are seeing what has turned out to be pretty severe second and even third waves of the virus across much of Europe, as well as meaningfully growing caseloads across much of the U.S. Vaccine developments are a clear positive, but the market's extremely positive reaction to the prospect of a post-coronavirus world creates some near-term uncertainty and risk.

Companies have used the health crisis as an opportunity to accelerate initiatives aimed at improving fundamental business practices and furthering digital and cloud adoption. Over time, we think these types of initiatives will result in better-run organizations with improved operating margins. Interest rates remain at ultralow levels as central banks around the globe continue to be extremely accommodative during the pandemic, an environment that will likely persist for the foreseeable future. We should also see multiyear growth in corporate earnings coming off depressed 2020 levels, which should be positive for equities.

However, markets have recovered not just what they lost early in the crisis; they are at all-time highs despite the economy facing potential headwinds due to restrictions aimed at controlling virus spread. Progress on coronavirus vaccine development has been unequivocally more positive than most expected in terms of both the speed of progress and their efficacy in preventing infections, but the virus continues to be highly disruptive, and production and distribution complexities mean we are still likely months away from achieving an adequate level of protection against the virus on a global scale.

In what remains a low-growth world, we believe real profit generation will continue to matter for investors, as will the durability of a business in a world of accelerating disruption. In the current environment, we think the key is to maintain portfolio breadth (having a balanced portfolio of holdings), diversification, and to apply risk control and active stock decision-making as we work through what is going to be an uneven path of recovery and improvement. Valuations are important, and we need to manage pockets of excessive optimism along with any uncertainty that arises with respect to U.S. policymaking.

It is also important to maintain a time horizon that allows for stocks to compound higher returns over the long term. Even though some disruptive growth stocks appear expensive when looking at their recent performance and near-term projections, we still see strong growth prospects and attractive valuations for some of these companies when looking out over a two- to three-year time horizon. We believe this nuanced approach to valuation is being overlooked by many investors and will help us provide better value add for our clients over the long term.

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 of companies that have the potential for above-average and sustainable rates of earnings growth. The companies may be anywhere in the world, including emerging markets.

Investment Approach

  • Single decision-maker provides clear accountability.
  • Identify “best ideas” by assessing companies in a global sector context, using bottom-up approach to create focused, high conviction portfolio.
  • Global research platform uses fundamental analysis to identify companies with superior and sustainable growth prospects, and improving fundamentals.
  • Macroeconomic and local market factors are integrated in stock selection decisions.
  • Valuation appeal is measured against local market and broad sector opportunity set.
  • Broad range of large-cap stocks, incorporating developed and emerging markets.

Portfolio Construction

  • Number of holdings: Typically around 130 holdings.
  • Individual positions: Typically 0.3%-3.0%, maximum 5%
  • Emerging markets exposure: +/- 15% of benchmark
  • Broad sector ranges: +/- 10% of benchmark
  • Country ranges: +/- 10% of benchmark (USA is +/- 20%)
  • Currency hedging: Currency views incorporated in stock selection
  • Cash target range: Typically less than 5%
  • Expected tracking error: 300 to 700 basis points

Performance (Class Q | EUR)

Annualised Performance

  1 YR 3 YR
Annualised
5 YR
Annualised
Since Inception
Annualised
Fund % 29.14% 18.64% 18.74% 16.75%
Indicative Benchmark % 6.74% 8.81% 10.96% 10.23%
Excess Return % 22.40% 9.83% 7.78% 6.52%

Inception Date 28-Oct-2014

Indicative Benchmark: MSCI All Country World Index Net

Data as of 31-Jan-2021

Performance figures calculated in EUR

  1 YR 3 YR
Annualised
5 YR
Annualised
Since Inception
Annualised
Fund % 31.47% 19.14% 16.10% 16.51%
Indicative Benchmark % 6.65% 9.37% 9.62% 10.34%
Excess Return % 24.82% 9.77% 6.48% 6.17%

Inception Date 28-Oct-2014

Indicative Benchmark: MSCI All Country World Index Net

Data as of 31-Dec-2020

Performance figures calculated in EUR

Recent Performance

  Month to DateData as of 01-Mar-2021 Quarter to DateData as of 01-Mar-2021 Year to DateData as of 01-Mar-2021 1 MonthData as of 31-Jan-2021 3 MonthsData as of 31-Jan-2021
Fund % 2.31% 6.89% 6.89% 2.65% 16.12%
Indicative Benchmark % 2.77% 5.52% 5.52% 0.25% 12.19%
Excess Return % -0.46% 1.37% 1.37% 2.40% 3.93%

Inception Date 28-Oct-2014

Indicative Benchmark: MSCI All Country World Index Net

Indicative Benchmark: MSCI All Country World Index Net

Performance figures calculated in EUR

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 July 2018, 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. 

31-Jan-2021 - Scott Berg, Portfolio Manager,
Global equities pulled back in January as complications in the rollout of coronavirus vaccines in many countries and worries about new outbreaks and strains of the virus weighed on sentiment. Within the portfolio, our consumer discretionary holdings contributed added the most. Shop Apotheke Europe is a disruptive online pharmacy currently focusing on the German market. Shares spiked following the company’s decision to launch EUR 225 million in convertible bonds amid strong demand for the issuance. We think the company is a well-run e-commerce business with a strong position in a large and structurally growing addressable market with low online penetration. Conversely, stock selection in the information technology sector hurt relative performance. Shares of digital payments business Global Payments lost ground following several months of strong performance, as investors became more pessimistic on certain secular growth names that had done well in 2020. We think the firm is a well-managed, high-quality payments business that benefits from secular tailwinds of cash-to-card conversions and a shift to faster-growth, technology-enabled distribution channels. We think Global Payments can drive double-digits earnings growth over the next few years, especially as it unlocks synergies from its recent takeover of Total Systems Services.

Holdings

Total
Holdings
181
Largest Holding Amazon.com 3.43% Was (30-Sep-2020) 3.40%
Other View Full Holdings Quarterly data as of  31-Dec-2020
Top 10 Holdings 16.29% View Top 10 Holdings Monthly data as of  31-Jan-2021

Largest Top Contributor^

Alphabet
By 0.80%
% of fund 2.24%

Largest Top Detractor^

Alibaba Group Holding
By -0.82%
% of fund 1.62%

^Absolute

Quarterly Data as of 31-Dec-2020

Top Purchase

AvalonBay Communities (N)
1.02%
Was (30-Sep-2020) 0%

Top Sale

MetLife (E)
0.00%
Was (30-Sep-2020) 0.62%

Quarterly Data as of 31-Dec-2020

31-Dec-2020 - Scott Berg, Portfolio Manager,

We continue to be surprised by the degree of optimism reflected in today's market, especially when looking at the world through a near-term lens as coronavirus caseloads and hospitalizations rise throughout Europe and the U.S. and will most likely continue to do so through the winter. While we share this optimism as we look out over one to two years, we think it makes sense to be prudent in terms of portfolio positioning in the near term. To us, this means focusing on having a balanced and diversified portfolio of names, being relatively sector neutral, and having a variety of ways to win regardless of the current market backdrop. We still own a blend of structural winners, durable compounders, and higher-yielding names that held up well during the March sell-off but lagged on the way back up.

Sector-wise, we are overweight consumer discretionary and financials, though not dramatically so. During the quarter, our allocations to real estate and industrials and business services increased, while our exposure to materials and utilities decreased as we trimmed or eliminated strong winners. Regionally, our allocation to Pacific ex-Japan increased, while exposure to Europe decreased. Given we are in a low interest rate, low-growth world for longer, we continue to be overweight fast-growing emerging market countries that have low debt-to-GDP ratios and attractive demographic growth, such as India, Indonesia, the Philippines, Vietnam, and Peru.

Real Estate

We reduced our underweight position over the quarter. Real estate has been challenged as the pandemic has reduced demand, but we think the sector stands to benefit as the pandemic wanes and demand accelerates. Additionally, in a lower-growth world, we think this is an area that offers solid yield backed by tangible, quality assets. Within the sector, we have a diverse mix of high-quality names of both residential and commercial assets in the U.S., Philippines, China, and London.

  • We initiated a position in AvalonBay Communities, the second-largest apartment REIT in the U.S. We think AvalonBay has a very high-quality portfolio of assets focused on urban and transit-oriented suburban areas on the East and West Coasts with a significant moat due to the company's experience, construction footprint, and financial strength. Although the stock rallied following Pfizer's positive vaccine announcement in early November, we think AvalonBay is well positioned for growth on the other side of the pandemic.
  • We initiated a position in American Campus Communities, the largest owner of student housing assets in the U.S. We think American Campus Communities is a high-quality, durable growth stock due to its portfolio of well-located, historically well-run assets and strong free cash flow. The stock was hammered during the initial stages of the pandemic as demand for student housing evaporated; however, we think the REIT represents a compelling long-term growth opportunity, and recent underperformance created an attractive entry point.

Information Technology

Advancements in areas like artificial intelligence (AI) and enterprise software are not only affecting technology companies, but also reshaping more traditional industries once viewed as less susceptible to business model disruption. The powerful long-run trends that we believe will drive value creation in the technology sector remain and, in some cases, have been accelerated by the ongoing pandemic. Aftereffects from the pandemic could also result in lasting behavioral changes with more people working remotely and payment methods skewing more digitally. As a result, software and electronic payments are areas of focus for our sector exposure, but we also remain positioned to benefit from increasing AI adoption as well as the growing technology consumption in emerging markets.

  • We initiated a position in Zoom Video Communications. This is a name we owned at the beginning of the year and sold after strong performance at the start of the pandemic. More recently, the stock pulled back amid the early rollout of the coronavirus vaccines, which investors feared would reduce demand for video conferencing services. However, we still think the company has room to grow internationally as the world moves to a hybrid work model on the other side of the coronavirus pandemic. In our view, Zoom Video Communications remains a long-term secular winner with a substantial growth runway.

Materials

The coronavirus-induced economic downturn has, not surprisingly, had a negative impact on the materials sector. Historically, the time to increase exposure to materials is during a recession and we added several high-quality names that were out of favor between the first and second quarters. However, a number of those names performed extremely well, so we exited our positions in the third and fourth quarters as valuations became more reasonable. Our focus is mainly on high-quality companies that offer particularly attractive valuations and are more highly correlated to staples-like industries and secular growth trends, but we also have exposure to containers and packaging companies and metals and mining.

  • Lundin Mining is a Canadian base metals miner mainly focused on copper. We eliminated our position in the wake of management's annual three-year guidance release, which came in below our expectations. We also believe the stock is trading near the top of its near-term range, so we elected to move on from our position.
  • Boliden is a zinc and copper mining and smelting company that we believe ranks among the highest-quality names in diversified metals and mining. The company has a strong management team that understands how to create value by investing countercyclically, keeping leverage low, using automation and technology to lower costs, and dampening volatility with an integrated smelting business. Shares rose in conjunction with zinc and copper prices. However, with these metals trading at cyclical highs, we eliminated� our position on reduced near-term upside.

Consumer Discretionary

In our view, there are more coronavirus beneficiaries in the consumer discretionary sector than anywhere else, but this has led to a dramatic demarcation between winners and losers. The coronavirus has pulled forward years of e-commerce share gains in the span of a few months, and we have an expanded set of names levered to that trend.

  • DoorDash operates the leading online food delivery platform in the U.S. We participated in the initial public offering and added to our position throughout the month. In our view, DoorDash operates in a nascent market that is still largely untapped. We are excited about the stock's growth potential as the business scales further and digital penetration rates increase over the medium to long term.
  • Hilton Worldwide and Marriott International benefited from positive vaccine news and a continued strong cyclical recovery in the broader market. With shares trading at elevated levels, we eliminated our positions. In our view, the stocks face a wide range of outcomes given the potential for a structural impairment in travel that lasts beyond the coronavirus pandemic.

Sectors

Total
Sectors
11
Largest Sector Information Technology 20.67% Was (31-Dec-2020) 21.76%
Other View complete Sector Diversification

Monthly Data as of 31-Jan-2021

Indicative Benchmark: MSCI All Country World Index

Top Contributor

N/A

Top Detractor

N/A

Largest Overweight

Consumer Discretionary
By4.64%
Fund 17.80%
Indicative Benchmark 13.16%

Largest Underweight

Energy
By-2.58%
Fund 0.51%
Indicative Benchmark 3.09%

Monthly Data as of 31-Jan-2021

31-Jan-2021 - Scott Berg, Portfolio Manager,
Real estate has been challenged as the pandemic has reduced demand, but we think the sector stands to benefit as the health crisis wanes and demand accelerates. In addition, in a lower growth world, we think this is an area that offers solid yield backed by tangible, quality assets. Within the sector, we own a diverse mix of high-quality companies of both residential and commercial assets in the U.S., Philippines, China, and London.

Countries

Total
Countries
26
Largest Country United States 52.74% Was (31-Dec-2020) 53.41%
Other View complete Country Diversification

Monthly Data as of 31-Jan-2021

Indicative Benchmark: MSCI All Country World Index

Largest Overweight

Germany
By4.60%
Fund 7.08%
Indicative Benchmark 2.48%

Largest Underweight

Japan
By-5.19%
Fund 1.55%
Indicative Benchmark 6.74%

Monthly Data as of 31-Jan-2021

Currency

Total
Currencies
20
Largest Currency 65.22% Was (31-Dec-2020) 64.23%
Other View completeCurrency Diversification

Monthly Data as of  31-Jan-2021

Indicative Benchmark :

Largest Overweight

U.S. dollar
By 6.12%
Fund 65.22%
Indicative Benchmark 59.10%

Largest Underweight

Japanese yen
By -5.19%
Fund 1.55%
Indicative Benchmark 6.74%

Monthly Data as of  31-Jan-2021

Team (As of 25-Feb-2021)

Scott Berg

Scott Berg is the portfolio manager for the T. Rowe Price Global Growth Equity Strategy and a vice president of T. Rowe Price Group, Inc.

Mr. Berg has 17 years of investment experience, all of which have been with T. Rowe Price. He joined the firm in 2002 as a research analyst covering the business services sector after serving as a summer intern in 2001. In 2005, he joined the global equity team as an associate portfolio manager and in 2008 launched the Global Growth Equity Strategy. Prior to T. Rowe Price, he was the manager of financial analysis and planning for Mead Consumer and Office Products. Previously, Mr. Berg was also employed by McKinsey & Company as a business analyst and was a core team member on the firm's global growth initiative.

Mr. Berg graduated first in his class from Macquarie University in Australia, with a B.Ec. in actuarial studies and finance. He also holds an M.B.A. from the Stanford Graduate School of Business, where he again graduated at the top of his class. Mr. Berg has earned the Chartered Financial Analyst designation.

  • Fund manager
    since
    2014
  • Years at
    T. Rowe Price
    18
  • Years investment
    experience
    18
Samuel Ruiz

Samuel Ruiz is a portfolio specialist in the Equity Division. He is a vice president of T. Rowe Price Australia Limited. 

Sam’s investment experience began in 2008, and he has been with T. Rowe Price since 2020, beginning as an associate working with the Global Equity and Australia Equity Strategies in the Equity Division. Prior to this, Sam was employed by Macquarie Investment Management in the area of strategy in the Equities Division. 

Sam earned a bachelor of applied finance degree from the University of South Australia.

  • Years at
    T. Rowe Price
    1
  • Years investment
    experience
    1
Laurence Taylor

Laurence Taylor is a portfolio specialist in the Equity Division. He represents the firm's global equity strategies to institutional clients, consultants, and prospects. Laurence is a vice president of T. Rowe Price Group, Inc., and T. Rowe Price International Ltd.

Laurence’s investment experience began in 1999, and he has been with T. Rowe Price since 2008, beginning in the Investment Specialist Group. Prior to this, Laurence was employed by AXA Rosenberg as a quantitative portfolio manager, with responsibility for global and European equity portfolios, and began his career at AonHewitt Associates in the UK investment practice. At AonHewitt, Laurence provided investment advice to European institutions as a client-facing consultant before specializing in the research and selection of global and regional equity managers in the manager research team.

Laurence earned a B.A., with honors, from Greenwich University. He also has earned the Chartered Financial Analyst® designation.

CFA® and Chartered Financial Analyst® are registered trademarks owned by CFA Institute.

  • Years at
    T. Rowe Price
    12
  • Years investment
    experience
    21

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 UK Tax Reporting Status
Class A $1,000 $100 $100 5.00% 160 basis points 1.77% No
Class I $2,500,000 $100,000 $0 0.00% 75 basis points 0.81% No
Class Q $1,000 $100 $100 0.00% 75 basis points 0.92% Yes
Class S $10,000,000 $0 $0 0.00% 0 basis points 0.06% No

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

T. Rowe Price Funds SICAV and its sub-funds are domiciled in Luxembourg and therefore considered offshore funds for UK tax purposes. Selected share classes of T. Rowe Price Funds SICAV have been designated “Reporting Funds” by HM Revenue & Customs (HMRC) under the guidelines of the UK Offshore Funds Regulation. These share classes report all relevant tax information to HMRC on an annual basis. Details on the information reported are outlined in the SICAV Shareholder Tax Reporting document that is available in the Fund Range Docs drop-down. Investors in “Reporting Fund” share classes who are considered United Kingdom residents for tax purposes will have any accrued gains treated as a capital gain rather than income upon sale or other disposal of their shares.