142

At a Glance

Why invest in Capital Micro-Cap?

  • One of the only variable annuity products dedicated to investing in micro-cap stocks (generally market caps up to $1 billion)
  • Core approach that combines multiple investment themes and offers wide exposure to micro-cap stocks by investing in companies with strong fundamentals and/or prospects selling at prices that Royce believes do not fully reflect these attributes
  • Approach emphasizes the intersection of valuation with fundamental strength and/or excellent growth or turnaround potential

As of 09/30/16

  • Micro-Cap
    Core Approach
    $422.8M
    Avg. Market Cap
  • Average
    Volatility
    89%
    Active Share
  • Fund
    Longevity
    19+
    Years of History

Portfolio Management

"The micro-cap universe offers plenty of opportunities for us to find companies that are lightly researched or mispriced. Using multiple approaches gives us exposure to the entire asset class while our discipline keeps us focused on the fundamental business strengths that we think can create strong long-term performance."
Jim Stoeffel

Manager Tenure

Manager Tenure

Performance

Average Annual Total Returns (%)

Outpaced Russell 2000 since inception (12/27/96) period as of 09/30/16.
QTR YTD 1YR 3YR 5YR 10YR 15YR SINCE INCEPT. DATE
Capital Micro-Cap 8.16 8.0412.80-1.055.253.267.699.65 12/27/96
Russell Microcap 11.25 9.3813.475.8416.375.508.85N/A N/A
Russell 2000 9.05 11.4615.476.7115.827.079.267.94 N/A

Annual Operating Expenses: Gross 1.61 Net 1.59

NOV YTD 1YR 3YR 5YR 10YR 15YR SINCE INCEPT. DATE
Capital Micro-Cap 10.32 15.0011.96-1.104.113.037.109.91 12/27/96
Russell Microcap 11.62 15.129.184.9714.885.178.31N/A N/A
Russell 2000 11.15 18.0012.086.4513.986.818.728.18 N/A

Annual Operating Expenses: Gross 1.61 Net 1.59

DEC YTD 1YR 3YR 5YR 10YR 15YR SINCE INCEPT. DATE
Capital Micro-Cap -0.19 14.7811.31-0.524.273.037.099.89 12/27/96
Russell Microcap -0.25 14.849.585.4414.825.208.29N/A N/A
Russell 2000 -0.60 17.2911.996.6713.916.818.688.14 N/A

Annual Operating Expenses: Gross 1.61 Net 1.59

Important Performance and Expense Information

All performance information reflects past performance, is presented on a total return basis, reflects the reinvestment of distributions, and does not reflect the deduction of taxes that 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. Current performance may be higher or lower than performance quoted. The Fund's total returns do not reflect any deduction for charges or expenses of the variable contracts investing in the Fund. Current month-end performance information may be obtained at www.roycefunds.com. Operating expenses reflect the Fund's total annual operating expenses for the investment class as of the Fund's most current prospectus include management fees, other expenses, and acquired fund fees and expenses. Acquired fund fees and expenses reflect the estimated amount of the fees and expenses incurred directly by the Fund through it's investments in mutual funds, hedged funds, private equity funds, and other investment companies.

All performance and risk information presented in this material prior to the commencement date of Service Class shares on 5/2/06 reflects Investment Class results. Service Class shares bear an annual distribution expense that is not borne by Investment Class shares. If Service Class's annual distribution expense had been reflected, total returns prior to 5/2/06 would have been lower.

Rolling Returns

On a monthly basis, the Fund outperformed the Russell Microcap in 70% of all 10-Year periods; 67% of all 5-Year periods; and 52% of all 1-Year periods.

For 87% of the periods, 10-year average annual total returns were greater than 5%.

Relative Returns: Monthly Rolling Average Annual Return Periods Since Russell Microcap's Inception Through 09/30/16

periods beating
the index(%)
fund
avg(%)
index
avg(%)
10-year
53/76
70 7.5 6.3
5-year
91/136
67 8.0 7.5
1-year
96/184
52 9.9 9.8

Absolute Returns: 10-Year Monthly Rolling Return PeriodsNumber of 10-Year Average Annual Return Periods Since the Fund’s Inception

Return Range Periods % in Range
> 10% 52 44
> 5% and ≤ 10% 51 43
> 0% and ≤ 5% 15 13
≤ 0% 0 0

The Fund averaged a 9.6% return over all 118 10-year monthly rolling return periods.

Market Cycle Performance

Peak-Peak - 07/12/07 - 03/05/14
Capital Micro-Cap23.7%
Russell Microcap44.7%

Peak-Peak - 03/05/14 - 06/23/15
Capital Micro-Cap-3.8%
Russell Microcap6.4%

Peak-Current - 06/23/15 - 09/30/16
Capital Micro-Cap-6.7%
Russell Microcap-5.3%

Royce defines market cycles as those that have retreated at least 15% from a previous market peak and have rebounded to establish a new peak above the previous one. 

Royce defines market cycles as those that have retreated at least 15% from a previous market peak and have rebounded to establish a new peak above the previous one. 

Calendar Year Total Returns (%)

 

Growth of Investment

Value of $10,000 invested between 06/30/00 and 09/30/16

Capital Micro-Cap$35,825.92
Russell Microcap$30,141.83

The since inception performance above dates to the inception of the Russell Microcap on 6/30/2000. The Fund's inception date (12/27/1996) preceded the inception of the index.

Portfolio Impactas of 09/30/16

SECTOR NAMEAVERAGE WEIGHT (%)TOTAL RETURN (%)CONTRIBUTION TO RETURN (%)
Information Technology
19.22
11.53
2.26
Industrials
17.80
12.21
1.95
Health Care
9.58
13.10
1.31
Financials
12.72
7.40
1.00
Consumer Discretionary
13.49
5.01
0.70
Energy
4.32
14.86
0.64
Materials
3.70
9.45
0.44
Real Estate
1.44
17.52
0.24
Consumer Staples
0.59
7.47
0.03
Utilities
0.06
-4.45
-0.01
Telecommunication Services
0.50
-2.73
-0.02
Cash
16.60
0.07
0.01

Top Contributors

INDUSTRYSECTORGAIN (%)
Semiconductors & Semiconductor EquipmentInformation Technology1.21
Electronic Equipment, Instruments & ComponentsInformation Technology1.07
MachineryIndustrials0.74
Investment CompaniesFinancials0.62
PharmaceuticalsHealth Care0.54

Top Detractors

INDUSTRYSECTORGAIN (%)
SoftwareInformation Technology-0.30
InsuranceFinancials-0.19
Construction MaterialsMaterials-0.10
Electrical EquipmentIndustrials-0.09
MarineIndustrials-0.07

Top Contributors

COMPANYINDUSTRYSECTORGAIN (%)
Direxion Daily Small Cap Bull 3X SharesInvestment CompaniesFinancials0.62
DTSElectronic Equipment, Instruments & ComponentsInformation Technology0.44
NeoPhotonics CorporationSemiconductors & Semiconductor EquipmentInformation Technology0.37
RelypsaPharmaceuticalsHealth Care0.33
CryoLifeHealth Care Equipment & SuppliesHealth Care0.28

Top Detractors

COMPANYINDUSTRYSECTORGAIN (%)
Rubicon ProjectSoftwareInformation Technology-0.26
AvingerHealth Care Equipment & SuppliesHealth Care-0.23
eHealthInsuranceFinancials-0.14
Power Solutions InternationalElectrical EquipmentIndustrials-0.13
Build-A-Bear WorkshopSpecialty RetailConsumer Discretionary-0.12
SECTOR NAMEAVERAGE WEIGHT (%)TOTAL RETURN (%)CONTRIBUTION TO RETURN (%)
Information Technology
21.43
14.54
3.28
Industrials
18.82
13.16
2.13
Consumer Discretionary
15.19
9.27
1.69
Materials
4.05
25.47
1.20
Financials
11.18
5.77
0.93
Utilities
0.10
64.19
0.21
Telecommunication Services
0.53
33.67
0.20
Consumer Staples
0.47
27.53
0.10
Real Estate
1.70
7.60
0.08
Energy
4.16
-0.70
-0.05
Health Care
10.86
-1.01
-0.39
Cash
11.52
0.21
0.03

Top Contributors

INDUSTRYSECTORGAIN (%)
Semiconductors & Semiconductor EquipmentInformation Technology2.36
Electronic Equipment, Instruments & ComponentsInformation Technology2.24
Metals & MiningMaterials1.39
Auto ComponentsConsumer Discretionary1.29
MachineryIndustrials1.13

Top Detractors

INDUSTRYSECTORGAIN (%)
SoftwareInformation Technology-0.85
BiotechnologyHealth Care-0.49
Specialty RetailConsumer Discretionary-0.46
Capital MarketsFinancials-0.29
Oil, Gas & Consumable FuelsEnergy-0.27

Top Contributors

COMPANYINDUSTRYSECTORGAIN (%)
Direxion Daily Small Cap Bull 3X SharesInvestment CompaniesFinancials0.62
DTSElectronic Equipment, Instruments & ComponentsInformation Technology0.61
PDF SolutionsSemiconductors & Semiconductor EquipmentInformation Technology0.50
Olympic SteelMetals & MiningMaterials0.49
Silicon Motion Technology ADRSemiconductors & Semiconductor EquipmentInformation Technology0.49

Top Detractors

COMPANYINDUSTRYSECTORGAIN (%)
SeaChange InternationalSoftwareInformation Technology-0.50
Ardmore ShippingOil, Gas & Consumable FuelsEnergy-0.39
AvingerHealth Care Equipment & SuppliesHealth Care-0.39
Rubicon ProjectSoftwareInformation Technology-0.34
NeonodeElectronic Equipment, Instruments & ComponentsInformation Technology-0.34
SECTOR NAMEAVERAGE WEIGHT (%)TOTAL RETURN (%)CONTRIBUTION TO RETURN (%)
Information Technology
21.55
22.28
4.83
Industrials
19.19
19.38
3.47
Materials
4.06
34.01
1.65
Financials
10.64
11.21
1.39
Consumer Discretionary
15.10
5.68
1.23
Health Care
11.30
10.78
1.22
Telecommunication Services
0.66
73.44
0.50
Utilities
0.07
64.19
0.21
Real Estate
1.74
13.34
0.19
Consumer Staples
0.50
15.26
0.05
Energy
4.29
-2.84
-0.04
Cash
10.91
0.23
0.03
Unclassified
0.00
0.00
0.00

Top Contributors

INDUSTRYSECTORGAIN (%)
Semiconductors & Semiconductor EquipmentInformation Technology2.99
Electronic Equipment, Instruments & ComponentsInformation Technology2.94
MachineryIndustrials1.52
Auto ComponentsConsumer Discretionary1.46
Metals & MiningMaterials1.40

Top Detractors

INDUSTRYSECTORGAIN (%)
Specialty RetailConsumer Discretionary-1.43
SoftwareInformation Technology-0.74
Internet Software & ServicesInformation Technology-0.34
DistributorsConsumer Discretionary-0.22
BiotechnologyHealth Care-0.19

Top Contributors

COMPANYINDUSTRYSECTORGAIN (%)
FabrinetElectronic Equipment, Instruments & ComponentsInformation Technology0.77
Direxion Daily Small Cap Bull 3X SharesInvestment CompaniesFinancials0.62
Theravance BiopharmaPharmaceuticalsHealth Care0.57
Olympic SteelMetals & MiningMaterials0.54
ORBCOMMDiversified Telecommunication ServicesTelecommunication Services0.54

Top Detractors

COMPANYINDUSTRYSECTORGAIN (%)
SeaChange InternationalSoftwareInformation Technology-0.44
QuinStreetInternet Software & ServicesInformation Technology-0.41
Container Store Group (The)Specialty RetailConsumer Discretionary-0.40
Ardmore ShippingOil, Gas & Consumable FuelsEnergy-0.36
BioDelivery Sciences InternationalPharmaceuticalsHealth Care-0.35
SECTOR NAMEAVERAGE WEIGHT (%)TOTAL RETURN (%)CONTRIBUTION TO RETURN (%)
Information Technology
18.30
28.05
4.94
Health Care
10.97
30.73
2.51
Financials
7.99
12.04
1.05
Real Estate
2.75
23.17
0.74
Industrials
21.36
4.85
0.49
Telecommunication Services
0.59
83.20
0.41
Utilities
0.06
64.99
0.21
Consumer Discretionary
15.02
-4.80
0.05
Consumer Staples
0.92
-15.28
-0.30
Materials
6.50
-36.79
-3.33
Energy
6.27
-53.99
-5.10
Cash
9.26
0.29
0.03
Unclassified
0.02
161.53
0.05

Top Contributors

INDUSTRYSECTORGAIN (%)
Semiconductors & Semiconductor EquipmentInformation Technology3.88
Electronic Equipment, Instruments & ComponentsInformation Technology2.76
Auto ComponentsConsumer Discretionary1.64
Health Care Equipment & SuppliesHealth Care1.30
Professional ServicesIndustrials1.02

Top Detractors

INDUSTRYSECTORGAIN (%)
Energy Equipment & ServicesEnergy-3.83
Metals & MiningMaterials-2.85
Specialty RetailConsumer Discretionary-1.83
Oil, Gas & Consumable FuelsEnergy-1.27
Electrical EquipmentIndustrials-0.87

Top Contributors

COMPANYINDUSTRYSECTORGAIN (%)
Smith & Wesson Holding CorporationLeisure ProductsConsumer Discretionary0.85
VASCO Data Security InternationalSoftwareInformation Technology0.83
FabrinetElectronic Equipment, Instruments & ComponentsInformation Technology0.83
Silicon Motion Technology ADRSemiconductors & Semiconductor EquipmentInformation Technology0.79
Drew IndustriesAuto ComponentsConsumer Discretionary0.65

Top Detractors

COMPANYINDUSTRYSECTORGAIN (%)
Dawson GeophysicalEnergy Equipment & ServicesEnergy-0.93
Gulf Island FabricationEnergy Equipment & ServicesEnergy-0.87
Global Power Equipment GroupElectrical EquipmentIndustrials-0.80
Universal Stainless & Alloy ProductsMetals & MiningMaterials-0.78
Mothers WorkSpecialty RetailConsumer Discretionary-0.78
SECTOR NAMEAVERAGE WEIGHT (%)TOTAL RETURN (%)CONTRIBUTION TO RETURN (%)
Information Technology
16.68
78.40
11.11
Industrials
20.57
58.50
10.26
Consumer Discretionary
14.94
55.09
9.11
Health Care
10.35
131.44
9.02
Financials
6.68
78.95
3.50
Real Estate
2.67
89.28
2.12
Telecommunication Services
0.71
116.07
0.62
Consumer Staples
1.40
-10.34
0.53
Utilities
0.09
-5.32
0.11
Energy
7.20
-29.20
-1.01
Materials
9.53
-45.27
-5.39
Cash
9.16
0.41
0.05
Unclassified
0.03
160.62
0.05

Top Contributors

INDUSTRYSECTORGAIN (%)
Semiconductors & Semiconductor EquipmentInformation Technology6.15
MachineryIndustrials4.77
Health Care Equipment & SuppliesHealth Care4.57
Specialty RetailConsumer Discretionary3.77
Electronic Equipment, Instruments & ComponentsInformation Technology3.16

Top Detractors

INDUSTRYSECTORGAIN (%)
Metals & MiningMaterials-6.22
Diversified Consumer ServicesConsumer Discretionary-1.06
Internet Software & ServicesInformation Technology-0.80
Oil, Gas & Consumable FuelsEnergy-0.61
Electrical EquipmentIndustrials-0.61

Top Contributors

COMPANYINDUSTRYSECTORGAIN (%)
Drew IndustriesAuto ComponentsConsumer Discretionary1.69
GP StrategiesProfessional ServicesIndustrials1.51
VASCO Data Security InternationalSoftwareInformation Technology1.30
Quaker ChemicalChemicalsMaterials1.26
Rudolph TechnologiesSemiconductors & Semiconductor EquipmentInformation Technology1.15

Top Detractors

COMPANYINDUSTRYSECTORGAIN (%)
Lincoln Educational ServicesDiversified Consumer ServicesConsumer Discretionary-1.16
Global Power Equipment GroupElectrical EquipmentIndustrials-0.90
Sprott ResourceOil, Gas & Consumable FuelsEnergy-0.77
Endeavour SilverMetals & MiningMaterials-0.73
SeaChange InternationalSoftwareInformation Technology-0.61

Risk

Average Volatility vs. Peer Group as of 09/30/16

The Fund has a average volatility within its peer group of 112 Insurance Fund Small-Cap Funds based on 5-year rolling standard deviation.

Down Market Performance Comparisonas of 09/30/16

The Fund outperformed the Russell Microcap during all nine downturns of 10% or more from the index’s prior historical high since the index’s inception.

Market Downturns (%)

DownMarketImg
Outperformed in 15 out of 24 down quarters.

Russell Microcap Down Quarters

QUARTER ENDRUSSELL MICROCAP (%)CAPITAL MICRO-CAP (%)SPREAD (%)
03/31/16-5.4-0.4+5.0
09/30/15-13.8-15.2-1.4
09/30/14-8.2-9.4-1.2
06/30/14-1.4+1.7+3.1
06/30/12-2.0-8.5-6.5
09/30/11-22.7-22.2+0.5
06/30/11-3.5-4.2-0.7
06/30/10-8.9-6.3+2.6
12/31/09-0.5+7.0+7.5
03/31/09-15.2-7.5+7.7
12/31/08-28.1-29.7-1.6
09/30/08-0.8-13.3-12.5
06/30/08-3.5+0.8+4.3
03/31/08-12.4-8.0+4.4
12/31/07-7.5-3.6+3.9
09/30/07-4.6-1.5+3.1
09/30/06-0.7-2.2-1.5
06/30/06-6.8-3.4+3.4
03/31/05-7.4-3.9+3.5
09/30/04-5.6-2.8+2.8
06/30/04-1.8-1.7+0.1
03/31/03-2.5-7.4-4.9
09/30/02-22.4-22.1+0.3
06/30/02-3.5-4.1-0.6

Capture Ratios From 06/30/00 (Russell Microcap Inception) to 09/30/16

Upside Capture Ratio measures a manager's performance in up markets relative to the Fund's benchmark. It is calculated by measuring the Fund's performance in quarters when the benchmark goes up and dividing it by the benchmark's return in those quarters.

Downside Capture Ratio measures a manager's performance in down markets relative to the Fund's benchmark. It is calculated by measuring the Fund's performance in quarters when the benchmark goes down and dividing it by the benchmark's return in those quarters.

Long Term Risk Measurementas of 09/30/16

Over the past 10 years, the Fund produced lower volatility than the Russell Microcap Index.
Over the past 5 years, the Fund produced lower volatility than the Russell Microcap Index.
Over the past 3 years, the Fund produced lower volatility than the Russell Microcap Index.
From the Index's inception, the Fund outperformed the Russell Microcap Index with lower volatility.

Go to Relative Risk Spectrum Tool

Morningstar Statistical Measures as of 09/30/16

The Fund produced lower volatility than the Russell Microcap and 50% of insurance fund small-cap objective funds, as shown by its standard deviation.
The Fund produced lower volatility than the Russell Microcap, as shown by its standard deviation.
The Fund produced lower volatility than the Russell Microcap, as shown by its standard deviation.
Sharpe RatioStandard Deviation
Capital Micro-Cap0.2219.60
Russell Microcap0.3220.81

Sharpe Ratio Standard Deviation
Capital Micro-Cap
Russell Microcap
Category Median
Best Quartile Breakpoint

Composition

Morningstar Style Map™as of 06/30/16

mstar-RCMSX

The Morningstar Style Map is the Morningstar Style Box™ with the center 75% of fund holdings plotted as the Morningstar Ownership Zone™. The Morningstar Style Box is designed to reveal a fund's investment strategy. The Morningstar Ownership Zone provides detail about a portfolio's investment style by showing the range of stock sizes and styles. The Ownership Zone is derived by plotting each stock in the portfolio within the proprietary Morningstar Style Box. The shaded area represents the center 75% of the Fund's assets while the plot point in the middle represents the weighted average of its holdings. Over time, the shape and location of a fund's ownership zone may vary.

Portfolio Diagnosticsas of 09/30/16

  RCMSX Russell Microcap
Average Market Cap
422.8M
380.6M
89%
-
2015 Portfolio Turnover
51%
-
Weighted Average P/E,
17.4x
-
Weighted Average P/B
1.7x
1.8x
U.S. Investments (% of Net Assets)
83.0%
-
Non-U.S. Investments (% of Net Assets)
10.7%
-

Portfolio Allocation

  • Total
    Holdings
    165


SECTORS
RCMSX (%) RUSSELL
MICROCAP (%)
Information Technology
22.2
15.0
Industrials
22.1
11.2
Consumer Discretionary
14.5
13.0
Financials
11.6
23.9
Health Care
10.9
21.1
Energy
5.2
3.9
Materials
4.4
2.8
Real Estate
1.6
4.3
Consumer Staples
0.7
2.0
Telecommunication Services
0.5
1.3
Utilities
-
1.4
Cash and Cash Equivalents
6.2
-
POSITIONS% OF NET ASSETS
(SUBJECT TO CHANGE)
ePlus
1.2
DTS
1.1
PC Connection
1.0
Kforce
1.0
Resources Connection
1.0
Citi Trends
1.0
Standard Motor Products
0.9
Photronics
0.9
AV Homes
0.9
Lindsay Corporation
0.9
Vishay Precision Group
0.9
Vera Bradley
0.8
PDF Solutions
0.8
Hudson Technologies
0.8
Lydall
0.8
Orbotech
0.8
Shoe Carnival
0.8
Ardmore Shipping
0.8
Clarkson
0.8
GP Strategies
0.8
Top 20 as % of Net Assets
18.0

SECTORS
RCMSX (%) RUSSELL
MICROCAP (%)
Industrials
23.2
-
Information Technology
22.2
-
Consumer Discretionary
14.8
-
Financials
12.1
-
Health Care
10.2
-
Energy
5.3
-
Materials
4.9
-
Real Estate
1.9
-
Consumer Staples
0.8
-
Telecommunication Services
0.5
-
Cash and Cash Equivalents
4.2
-
POSITIONS% OF NET ASSETS
(SUBJECT TO CHANGE)
ePlus
1.2
DTS
1.2
Resources Connection
1.0
Citi Trends
1.0
Lindsay Corporation
1.0
PC Connection
0.9
Standard Motor Products
0.9
Navigant Consulting
0.9
PDF Solutions
0.9
Photronics
0.9
AV Homes
0.9
Kforce
0.9
Vishay Precision Group
0.9
Shoe Carnival
0.9
GP Strategies
0.8
Capella Education
0.8
CIRCOR International
0.8
Ultra Clean Holdings
0.8
Park Sterling
0.8
Gulf Island Fabrication
0.8
Top 20 as % of Net Assets
18.3

Portfolio Holdings

View the complete list of holdings for this fund as of 09/30/16. Unaudited schedule of portfolio holdings is presented for informational purposes only.

Least Portfolio Overlap - U.S. Equity Funds

Greatest Portfolio Overlap - U.S. Equity Funds

Geographical Breakdown

Distributions

NAV & Distributions


Start DateEnd Date
to

Learn more about distributions

Distributions

RECORD
DATE
EX-DATE PAYABLE
DATE
INCOME ($) SHORT
TERM
GAINS ($)
LONG
TERM
GAINS ($)
RETURN OF
CAPITAL ($)
TOTAL ($) REINVEST
PRICE ($)
12/16/15 12/17/15 12/17/15 0.0000 0.0314 0.5776 - 0.6090 9.13
12/16/14 12/17/14 12/17/14 0.0000 0.0313 0.9441 - 0.9754 10.94
12/11/13 12/12/13 12/12/13 0.0423 - 0.3354 - 0.3777 12.16
12/12/12 12/13/12 12/13/12 0.0000 - 0.2427 - 0.2427 10.49
12/14/11 12/15/11 12/15/11 0.2849 - - - 0.2849 10.05
12/15/10 12/16/10 12/16/10 0.1935 - - - 0.1935 11.88

NAV History for

Fees & Expenses

Shareholder Fees (%)

(fees paid directly from your investment)

Maximum sales charge (load) imposed on purchases 0.00
Maximum deferred sales charge 0.00
Maximum sales charge (load) imposed on reinvested dividends 0.00
Redemption fee (as a percentage of amount redeemed on shares held for less than 180 days) 0.00

Annual Fund Operating Expenses (%)

(expenses that you pay each year as a percentage of the value of your investment)

Management fees 1.25
Distribution (12b-1) fees 0.25
Other expenses 0.10
Acquired fund fees and expenses 0.01
Total annual Fund operating expenses 1.61
Fee waivers and/or expense reimbursements (0.02)
Total annual Fund operating expenses after fee waivers and/or expense reimbursements1.59
Total annual Fund operating expenses may differ from the expense ratio in the Fund's Financial Highlights because they include only the Fund's direct operating expenses and do not include acquired fund fees and expenses, which 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.

Important Disclosure Information

This material is not authorized for distribution unless preceded or accompanied by a current prospectus. Please read the prospectus carefuly before investing or sending money. The Fund invests primarily in micro-cap stocks, which may involve considerably more risk than investments in securities of larger-cap companies. (Please see "Primary Risks for Fund Investors" in the prospectus.) The Fund’s broadly diversified portfolio does not ensure a profit or guarantee against loss. The Fund may invest up to 25% of its net assets in foreign securities (measured at the time of investment), which may involve political, economic, currency, and other risks not encountered in U.S. investments. (Please see "Investing in Foreign Securities" in the prospectus.)

Sector weightings are determined using the Global Industry Classification Standard ("GICS"). GICS was developed by, and is the exclusive property of, Standard & Poor's Financial Services LLC ("S&P") and MSCI Inc. ("MSCI"). GICS is the trademark of S&P and MSCI. "Global Industry Classification Standard (GICS)" and "GICS Direct" are service marks of S&P and MSCI.

The Price-Earnings, or P/E, Ratio is calculated by dividing a company's share price by its trailing 12-month earnings-per-share (EPS). The Fund's P/E ratio calculation excludes companies with zero or negative earnings. The Price-to-Book, or P/B, Ratio is calculated by dividing a company's share price by its book value per share. Standard deviation is a statistical measure within which a fund's total returns have varied over time. The greater the standard deviation, the greater a fund's volatility. Russell Investment Group is the source and owner of the trademarks, service marks, and copyrights related to the Russell Indexes. Russell® is a trademark of Russell Investment Group. 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. Russell Investment Group is the source and owner of the trademarks, service marks and copyrights related to the Russell Indexes. Russell© is a trademark of Russell Investment Group. The Russell 2000 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 performance of an index does not represent exactly any particular investment, as you cannot invest directly in an index. The performance of an index does not represent exactly any particular investment, as you cannot invest directly in an index.

Jim Stoeffel lead manager since 2015 (co-manager 2015), Jenifer Taylor (co-manager or manager 2009-2015), Chris Flynn, Jim Harvey, and Brendan Hartman since 2015 (assistant portfolio manager 2013-2015)

5/2/2006 12:00:00 AM

Share:

Subscribe:

Sign Up

Follow: