Chris Clark In Fund Intelligence Talking Royce’s Global Expansion and ESG—Royce
article 03-29-2021

Chris Clark In Fund Intelligence Talking Royce’s Global Expansion and ESG

CEO and Co-CIO Chris Clark spoke to Fund Intelligence about the firm’s continued commitment to expand our footprint in international small caps and ESG, and our more cautious approach to entering the ETF market space.

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CEO and Co-CIO Chris Clark was featured in a Fund Intelligence article titled “Royce CEO Talks Global Expansion, ESG” by Ben Strack discussing why the firm’s global expansion remains a key priority, how we’re navigating entering the nontransparent ETF market, and more.

Read the article (subscription required).

Chris explained that the firm is seeing the benefit of Franklin Templeton’s global reach and distribution, allowing Royce to become "the small cap platform of choice.” Royce Investment Partners began committing to U.S., global, and international strategies several years ago. In addition, he said the firm has continued to add new investment talent since the number of independent research organizations focused on the asset class has decreased. He added that ETF vehicles will likely be integrated into Royce in three to five years.

The governance element in ESG, Chris noted, has historically been a key part of Royce's investment process. Although small caps are behind large caps in this area, Chris said it is quickly evolving. "Given our domain knowledge in the space -- we have relationships literally with thousands of companies over our 50-year history -- we believe we can both be a leader in terms of the evaluation of businesses, but also be leader in working with companies as to how best to report on their activities,” Chris was quoted saying in the article.

Read the article (subscription required).

Learn more about Chris Clark here.

Important Disclosure Information

Performance and Expenses
As of 12/31/20

  Average Annual Total Returns (%) Annual
Operating
Expenses (%)
  1YR 3YR 5YR 10YR 15YR 20YR 45YR/Since
Incept.
Date Gross Net
Dividend Value  4.47 4.33 9.96 8.03 8.03 N/A 8.45 5/3/04 1.52 1.34
Global Financial Services 15.25 7.41 11.37 9.89 7.81 N/A 8.48 12/31/03 1.84 1.52
International Premier 15.74 10.67 13.40 9.29 N/A N/A 9.29 12/31/10 1.58 1.44
Micro-Cap 24.50 11.16 11.64 5.20 6.57 8.86 10.86 12/31/91 1.34 1.24
Opportunity 26.52  9.09 15.49 10.47 9.13 10.73 12.26 11/19/96 1.22 1.22
Pennsylvania Mutual 14.08 9.26 13.90 9.61 8.18 9.92 13.68 N/A 0.94 0.94
Premier 11.50 10.25 15.33 9.91 9.33 10.74 11.76 12/31/91 1.19 1.19
Small-Cap Value -6.47 0.87 5.51 4.14 5.27 N/A 8.20 6/14/01 1.55 1.49
Small-Companies Growth 49.26 18.34 16.38 11.59 9.07 N/A 12.47 6/14/01 1.55 1.49
Special Equity 7.43  2.93 9.24 7.49 7.68 9.88 8.57 5/1/98 1.21 1.21
Total Return 3.82 3.91  9.92 8.47 7.20 8.69 10.23 12/15/93 1.23 1.23
Russell 2000 19.96  10.25 13.26 11.20 8.91 8.74 N/A N/A N/A N/A
Russell Microcap 20.96 8.78 11.89 10.55 7.34 8.95 N/A N/A N/A N/A
Russell 2000 Value 4.63  3.72 9.65 8.66 6.92 8.54 N/A N/A N/A N/A
Russell 2500 4.63 3.72 9.65 8.66 6.92 8.54 N/A  N/A  N/A  N/A
 MSCI ACWI ex USA Small Cap  14.24 4.59 9.37 5.95 6.42 8.50 N/A N/A N/A  N/A

1For Royce Pennsylvania Mutual Fund, the average annual total return shown is for the 45-year period ended 12/31/20.

All performance information in this Review and Report reflects past performance, is presented on a total return basis, reflects the reinvestment of distributions, and does not reflect the deduction of taxes a shareholder would pay on fund distributions or the redemption of fund shares. Past performance is no guarantee of future results. Investment return and principal value of an investment will fluctuate, so that shares may be worth more or less than their original cost when redeemed. Investment and Service Class shares redeemed within 30 days of purchase may be subject to a 1% redemption fee payable to the Fund (2% for Royce International Premier Fund). Redemption fees are not reflected in the performance shown above; if they were, performance would be lower. Current performance may be higher or lower than performance quoted. Current month-end performance may be obtained at www.royceinvest.com. All performance and expense information reflects results of the Funds’ oldest share Class (Investment Class or Service Class, as the case may be). Price and total return information is based on net asset values calculated for shareholder transactions. Gross annual operating expenses reflect the Fund’s gross total annual operating expenses and include management fees, any 12b-1 distribution and service fees, other expenses, and any applicable acquired fund fees and expenses. Net annual operating expenses reflect contractual fee waivers and/or expense reimbursements. All expense information is reported as of the Fund’s most current prospectus. Royce & Associates has contractually agreed to waive fees and/or reimburse operating expenses, excluding brokerage commissions, taxes, interest, litigation expenses, acquired fund fees and expenses, and other expenses not borne in the ordinary course of business, to the extent necessary to maintain net operating expenses at or below: 1.24% for Royce Micro-Cap Fund; 1.34% for Royce Dividend Value Fund; 1.44% for Royce International Premier Fund; 1.49% for Royce Global Financial Services, Small-Cap Value, and Smaller-Companies Growth Funds through April 30, 2021. Acquired fund fees and expenses reflect the estimated amount of the fees and expenses incurred indirectly by the Fund through its investments in mutual funds, hedge funds, private equity funds, and other investment companies.
Service Class shares bear an annual distribution expense that is not borne by the Funds’ Investment Class. If such distribution expenses had been reflected for Funds showing Investment Class performance, returns would have been lower. Investments in securities of micro-cap, small-cap, and/or mid-cap companies may involve considerably more risk than investments in securities of larger-cap companies. (Please see “Primary Risks for Fund Investors” in the prospectus.) Certain Funds invest a significant portion of their respective assets in foreign companies that may be subject to different risks than investments in securities of U.S. companies, including adverse political, social, economic, or other developments that are unique to a particular country or region. (Please see “Investing in Foreign Securities” in the prospectus.) Therefore, the prices of securities of foreign companies in particular countries or regions may, at times, move in a different direction than those of securities of U.S. companies. (Please see “Primary Risk of Fund Investors” in the prospectus.) Certain Funds generally invest a significant portion of their assets in a limited number of stocks, which may involve considerably more risk than a more broadly diversified portfolio because a decline in the value of any of these stocks would cause their overall value to decline to a greater degree. A broadly diversified portfolio, however, does not ensure a profit or guarantee against loss.

Mr. Clark’s thoughts and opinions concerning the stock market are solely their own and, of course, there can be no assurance with regard to future market movements. No assurance can be given that the past performance trends as outlined above will continue in the future.

The performance data and trends outlined in this presentation are presented for illustrative purposes only. Past performance is no guarantee of future results. Historical market trends are not necessarily indicative of future market movements.

For the one-year period ended 12/31/20, Royce Opportunity Fund finished in the second percentile out of 416 funds in Morningstar's Small Value category, with a 26.5% return versus a 22.5% average for the category; for the three-year period, the Fund finished in the first percentile out of 386 funds, with a 9.1% return versus a 6.9% average for the category; for the five-year period, the Fund finished in the first percentile out of 358 funds, with a 15.5% return versus a 7.6% average for the category; and for the 10-year period, the Fund finished in the first percentile out of 259 funds, with a 10.5% return versus a 2.7% average for the category.

Source: MSCI. MSCI makes no express or implied warranties or representations and shall have no liability whatsoever with respect to any MSCI data contained herein. The MSCI data may not be further redistributed or used as a basis for other indexes or any securities or financial products. This report is not approved, endorsed, reviewed or produced by MSCI. None of the MSCI data is intended to constitute investment advice or a recommendation to make (or refrain from making) any kind of investment decision and may not be relied on as such.

The MSCI ACWI ex USA Small Cap Index is an unmanaged, capitalization-weighted index of global small-cap stocks, excluding the United States. Index returns include net reinvested dividends and/or interest income.

Frank Russell Company (“Russell”) is the source and owner of the trademarks, service marks and copyrights related to the Russell Indexes. Russell® is a trademark of Frank Russell Company. Neither Russell nor its licensors accept any liability for any errors or omissions in the Russell Indexes and / or Russell ratings or underlying data and no party may rely on any Russell Indexes and / or Russell ratings and / or underlying data contained in this communication. No further distribution of Russell Data is permitted without Russell’s express written consent. Russell does not promote, sponsor or endorse the content of this communication. All indexes referenced are unmanaged and capitalization-weighted. The Russell 2000 Index is an unmanaged, capitalization-weighted index of domestic small-cap stocks. It measures the performance of the 2,000 smallest publicly traded U.S. companies in the Russell 3000 Index. The Russell Microcap Index includes 1,000 of the smallest securities in the small-cap Russell 2000 Index along with the next smallest eligible securities as determined by Russell. The Russell 2000 Value Index consists of the respective value stocks within the Russell 2000 as determined by Russell Investments. The Russell 2500 is an unmanaged, capitalization-weighted index of the 2,500 smallest publicly traded U.S. companies in the Russell 3000 index. The performance of an index does not represent exactly any particular investment as you cannot invest directly in an index.

This material is not authorized for distribution unless preceded or accompanied by a current prospectus. Please read the prospectus carefully before investing or sending money. Smaller-cap stocks may involve considerably more risk than larger-cap stocks. (Please see "Primary Risks for Fund Investors" in the prospectus.)

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