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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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SICAV

Global Natural Resources Equity Fund

Seeking to identify long-term global winners in the arena of natural resources extraction and production.

ISIN LU1382644919 Bloomberg TRPGNQR:LX

3YR Return Annualised
(View Total Returns)

Total Assets
(USD)

-2.80%
$94.3m

1YR Return
(View Total Returns)

Manager Tenure

-6.35%
4yrs

Inception Date 18-Mar-2016

Performance figures calculated in GBP

Other Literature

31-Dec-2020 - Shawn T. Driscoll, Portfolio Manager,
We continue to believe that we are in a secular bear market for many commodities. Global supplies of crude oil remain elevated despite a modest recovery in demand and, while the recent reflation rally likely has more room to run, we expect energy stocks to be relative laggards going forward. Over the long term, we believe that oil prices are likely to settle in the mid-USD 40s per barrel.
Shawn T.  Driscoll
Shawn T. Driscoll, Portfolio Manager

Shawn Driscoll is the portfolio manager of the Global Natural Resources Equity Strategy, including the New Era Fund, in the U.S. Equity Division. He is chairman of the Investment Advisory Committee of the Global Natural Resources Equity Strategy and a vice president and an Investment Advisory Committee member of the US Capital Appreciation, US Large-Cap Core Equity, US Growth Stock, US Large-Cap Core Equity, US Mid-Cap Growth Equity, US Multi-Cap Growth Equity, and Real Assets Equity Strategies. Shawn also is a vice president of T. Rowe Price Group, Inc.

 

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 of natural resources or commodities-related companies. The companies may be anywhere in the world, including emerging markets.

Investment Approach

  • Focus on well-managed companies that own or develop natural resources and other basic commodities with attractive long-term supply-demand fundamentals.
  • Invest in companies that operate “downstream” from these resources, e.g., refining, paper manufacturing, steel fabrication, and petrochemicals.
  • The portfolio invests in resource companies on a global basis including — international energy, forest products, mining, and commodities.
  • Assessment of resource/commodity cycle, industry valuation, and company fundamentals is key.
  • Broadly diversify holdings to manage portfolio risk profile relative to highly concentrated energy or gold strategies.

Portfolio Construction

  • Typically 90-120 securities
  • Positions typically range to 5%
  • Reserves typically range from 0% to 5%

Performance (Class Q | GBP)

Annualised Performance

  1 YR 3 YR
Annualised
5 YR
Annualised
Since Inception
Annualised
Fund % -6.35% -2.80% N/A 4.31%
Indicative Benchmark % -14.97% -6.00% N/A 3.51%
Excess Return % 8.62% 3.20% N/A 0.80%

Inception Date 18-Mar-2016

Indicative Benchmark: MSCI World Select Natural Resources Index Net

Data as of 31-Dec-2020

Performance figures calculated in GBP

  1 YR 3 YR
Annualised
5 YR
Annualised
Since Inception
Annualised
Fund % -6.35% -2.80% N/A 4.31%
Indicative Benchmark % -14.97% -6.00% N/A 3.51%
Excess Return % 8.62% 3.20% N/A 0.80%

Inception Date 18-Mar-2016

Indicative Benchmark: MSCI World Select Natural Resources Index Net

Data as of 31-Dec-2020

Performance figures calculated in GBP

Recent Performance

  Month to DateData as of 20-Jan-2021 Quarter to DateData as of 20-Jan-2021 Year to DateData as of 20-Jan-2021 1 MonthData as of 31-Dec-2020 3 MonthsData as of 31-Dec-2020
Fund % 6.13% 6.13% 6.13% 0.25% 12.50%
Indicative Benchmark % 9.69% 9.69% 9.69% 2.70% 16.12%
Excess Return % -3.56% -3.56% -3.56% -2.45% -3.62%

Inception Date 18-Mar-2016

Indicative Benchmark: MSCI World Select Natural Resources Index Net

Indicative Benchmark: MSCI World Select Natural Resources Index Net

Performance figures calculated in GBP

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-Dec-2020 - Shawn T. Driscoll, Portfolio Manager,
Except for natural gas, commodity prices were positive across the board in December. Crude oil continued to rally, as efforts to pass another U.S. coronavirus relief package added to optimism that the vaccine’s rollout will boost oil demand. Copper and Steel led the advance in diversified metals and mining companies, while precious metals and minerals companies gained, as several gold, silver, and platinum miners boasted staggering returns. The paper and forest products and specialty chemicals industries also rose. However, natural gas prices slumped for the second month in a row, stung by warmer-than-expected weather forecasts that are denting demand. Within the portfolio, an underweight position and stock selection in diversified metals and mining hindered relative performance. While copper and steel were notably strong during the month, we believe that a global oversupply of many base metals could be a headwind through much of what is, in our view, a secular bear market in commodities. Overweighting specialty chemicals and industrial gases also hurt, as these defensive stocks lagged the benchmark. Conversely, we benefitted from an underweight in precious metals and minerals and a lack of exposure in water utilities, as these industries underperformed.

Holdings

Total
Holdings
113
Largest Holding Total 4.44% Was (30-Sep-2020) 3.85%
Other View Full Holdings Quarterly data as of  31-Dec-2020
Top 10 Holdings 24.22% View Top 10 Holdings Monthly data as of  31-Dec-2020

Largest Top Contributor^

Total
By 2.25%
% of fund 4.40%

Largest Top Detractor^

Air Products & Chemicals
By -0.85%
% of fund 1.98%

^Absolute

Quarterly Data as of 31-Dec-2020

Top Purchase

Array Technologies (N)
0.97%
Was (30-Sep-2020) 0%

Top Sale

ConocoPhillips
1.09%
Was (30-Sep-2020) 2.02%

Quarterly Data as of 31-Dec-2020

30-Sep-2020 - Shawn T. Driscoll, Portfolio Manager,

Our bearish long-term outlook for oil prices and belief that we are in the middle of a secular downcycle for commodities have not changed. Accordingly, we favor defensive industries, such as electric utilities, and areas of the natural resources universe that tend to benefit from lower commodity prices. We continued to upgrade the portfolio by exiting lower-conviction ideas while adding to high-quality names that look attractive now and that we'd like to own on the other side of the economic cycle. We increased the portfolio's exposure to paper and forest products, an industry where we believe production cost curves are rising and the supply/demand outlook appears favorable. Depending on the duration of the coronavirus outbreak, we see the potential for a sharp rebound in oil prices over the near term as demand normalizes, and we have been selective in how we position for this trade. As always, we remain conscious of valuation, industry fundamentals, and longer-term risk/reward propositions for the individual companies in which we invest.

Paper and Forest Products

We increased the portfolio's allocation to this industry to reflect our increasing conviction in the potential for cost curves to rise throughout the value chain, supporting timber and containerboard prices and improving profit margins in the industry.

  • We initiated positions in Stora Enso and added to Svenska Cellulosa. These European producers of forest products could see significant upside to their midcycle earnings. We also see a reasonable path to the market assigning significant value to forest holdings as wood-based products replace less sustainable alternatives and as carbon-capture emerges as part of the solution for the global climate crisis.

Integrated Oil and Gas

We refined the portfolio's positioning in integrated oil and gas given the shrinking universe of viable options and structural headwinds from the shift to renewable energy.

  • We appreciate France-based Total's high-quality management team, capital discipline, strong balance sheet, and credible plan to deliver solid production growth in the coming years. These qualities and an attractive dividend yield make Total appealing in an environment where we expect the cost curve for oil to remain under pressure. However, we trimmed Total, which remained the portfolio's largest holding, to manage position size.
  • We exited our position in Canada-based Suncor Energy, as the company recently announced potential efforts to sacrifice its upstream production for more ESG-friendly downstream. This shift is a breach to our investment thesis and is a distraction to the management team, in our view, that could dilute returns.

Metal and Glass Containers

We increased the portfolio's allocation to this defensive industry. Our holdings emphasize investment ideas that we believe offer the most compelling risk/reward profiles.

  • We initiated a position in Crown Holdings, one of the largest beverage can manufacturers globally. The company benefits from surging demand from beverage and food manufacturers for aluminum cans, as well as a growing total addressable market given the shift from plastic to more sustainable products including aluminum.
  • We trimmed the portfolio's stake in Ball Corporation, a leading manufacturer of aluminum packaging, on strength. However, we continue to maintain a meaningful allocation in Ball, which should benefit as aluminum packaging replaces less sustainable options and cans take market share in cocktails and wines. We expect that Ball can grow its organic topline given competitive pricing in specialty cans and supportive supply/demand dynamics, as well as new beverage categories.

Precious Metals and Mining

The portfolio remained underweight precious metals and minerals, an industry where we prefer small- to mid-cap producers pursuing mining projects that are lower on the cost curve and should drive significant production and cash flow growth upon completion. In our view, gold miners with these high-quality expansion opportunities, as well as credible management teams and solid balance sheets, have the potential to create significant value for shareholders even if commodity prices do not cooperate.

  • We sold some shares of Canadian miner Kirkland Lake Gold. Unlike other North American gold miners, Kirkland Lake has been highly successful because of its ability to buy overlooked assets with under-utilized infrastructure and then use its exploration expertise to grow production. However, the company's questionable acquisition of Detour Gold prompted us to trim our position in favor of other compelling opportunities.

Commodity Chemicals

We favor defensive sectors that could benefit from low commodity prices.

  • We initiated a position in Orica, the largest supplier of industrial explosives and blasting services to the mining, quarrying, seismic, and construction industries globally. It also manufactures industrial and specialty chemicals for the mining industry. In our view, Orica's access to copper miners is favorable given the medium- to long-term outlook for copper prices and the potential for growing demand as the adoption of electric vehicles grows.

Semiconductor Equipment

While the portfolio has limited exposure to the space, we think that parts of the industry could benefit from thin inventories when economic activity recovers dynamics.

  • We initiated a new position in Cabot Microelectronics, an electronic materials supplier that will benefit from rising semiconductor cost curves. We expect Cabot's legacy tungsten slurries business to grow faster than the semiconductor industry while holding or adding to margins as a result of increasing materials per chip.

Sectors

Total
Sectors
9
Largest Sector Chemicals 19.16% Was (30-Nov-2020) 19.71%
Other View complete Sector Diversification

Monthly Data as of 31-Dec-2020

Indicative Benchmark: Lipper Global Natural Resources Funds Index

Largest Overweight

Chemicals
By12.38%
Fund 19.16%
Indicative Benchmark 6.78%

Largest Underweight

Metals & Mining
By-10.44%
Fund 12.32%
Indicative Benchmark 22.76%

Monthly Data as of 31-Dec-2020

31-Dec-2020 - Shawn T. Driscoll, Portfolio Manager,
We have seen a strong recovery in oil prices and energy stocks as oil demand accelerated from its low, however our bearish long-term outlook for oil prices has not changed. Accordingly, we favour defensive industries, such as electric utilities, and areas of the natural resources universe that tend to benefit from lower commodity prices. We also see meaningful opportunities in the paper and forest products industry, which could benefit from a steepening cost curve and a favourable environmental, social, and corporate governance (ESG) profile.

Countries

Total
Countries
18
Largest Country United States 53.76% Was (30-Nov-2020) 55.45%
Other View complete Country Diversification

Monthly Data as of 31-Dec-2020

Indicative Benchmark: Lipper Global Natural Resources Funds Index

Largest Overweight

United States
By4.85%
Fund 53.76%
Indicative Benchmark 48.91%

Largest Underweight

Canada
By-5.65%
Fund 6.80%
Indicative Benchmark 12.45%

Monthly Data as of 31-Dec-2020

31-Jul-2015 - Shawn T. Driscoll, Portfolio Manager,
From a country perspective, our allocation to Norway saw the largest percentage increase during the month of July. There were no notable reductions for the period.

Currency

Total
Currencies
10
Largest Currency 58.36% Was (30-Nov-2020) 60.07%
Other View completeCurrency Diversification

Monthly Data as of  31-Dec-2020

Indicative Benchmark :

Largest Overweight

U.S. dollar
By 9.24%
Fund 58.36%
Indicative Benchmark 49.11%

Largest Underweight

Canadian dollar
By -8.90%
Fund 4.54%
Indicative Benchmark 13.44%

Monthly Data as of  31-Dec-2020

Team (As of 15-Jan-2021)

Shawn T.  Driscoll

Shawn Driscoll is the portfolio manager of the Global Natural Resources Equity Strategy, including the New Era Fund, in the U.S. Equity Division. He is chairman of the Investment Advisory Committee of the Global Natural Resources Equity Strategy and a vice president and an Investment Advisory Committee member of the US Capital Appreciation, US Large-Cap Core Equity, US Growth Stock, US Large-Cap Core Equity, US Mid-Cap Growth Equity, US Multi-Cap Growth Equity, and Real Assets Equity Strategies. Shawn also is a vice president of T. Rowe Price Group, Inc. 

Shawn’s investment experience began in 2003, and he has been with T. Rowe Price since 2006, beginning in the U.S. Equity Division. Prior to this, Shawn was employed by MTB Investment Advisors as an equity research analyst. Shawn also was employed by MPower Communications as an information technology project manager. 

Shawn earned a B.A. in economics and mathematics from the University of Rochester and an M.B.A. in finance and global business from New York University, Leonard N. Stern School of Business.

  • Fund manager
    since
    2016
  • Years at
    T. Rowe Price
    14
  • Years investment
    experience
    17
Brian Dausch, CFA

Brian Dausch is a portfolio specialist in the U.S. Equity Division. He is a member of the Global Natural Resources Equity, US Mid-Cap Growth Equity, US Small-Cap Growth Equity, QM US Small-Cap Growth Equity, and Health Sciences Equity Strategy teams, working closely with institutional clients, consultants, and prospects. He is a vice president of T. Rowe Price Group, Inc.  

Brian’s investment experience began in 1997, and he has been with T. Rowe Price since 1998, beginning in the U.S. Equity Division as an associate investment analyst covering biotechnology and pharmaceutical companies. Prior to his current role, Brian managed the U.S. Equity Portfolio Analysis Group.

Brian earned a B.S. in business administration, with a concentration in finance, from the University of Delaware. 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
    22
  • Years investment
    experience
    23

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 1.74% No
Class I $2,500,000 $100,000 $0 0.00% 75 basis points 0.84% Yes
Class Q $1,000 $100 $100 0.00% 75 basis points 0.92% Yes

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.