Royce International Premier Fund (RYIPX, RIPNX, RINPX, RIPIX)
259

At a Glance

Why invest in International Premier?

  • Focuses on a limited number of “premier” non-U.S. small-cap companies (generally market caps up to $3 billion) with discernible competitive advantages, high returns on invested capital, and sustainable, moat-like franchises
  • Seeks to identify companies with notable strengths in industry structure, competitive positioning, operational efficiency, financial track record, and corporate governance
  • Outperformed its benchmark, the MSCI ACWI ex USA Small Cap Index, for the 1-, 3-, 5-year, and since inception (12/31/10) periods ended 9/30/19

As of 09/30/19

  • Small-Cap
    Core Approach
    $2.00B
    Avg. Market Cap
  • Below Average
    Volatility
    99%
    Active Share
  • Fund
    Longevity
    8+
    Years of History

Portfolio Management

"We're seeking to build a portfolio of very high-quality, world-class businesses–those that are a-cyclical growers, can generate plentiful free cash, and have a genuine and defensible moat."
Mark Rayner

Performance

Average Annual Total Returns (%)

Outperformed MSCI ACWI ex USA Small Cap for the Year To Date, 1-Year, 3-Year, 5-Year and since inception (12/31/10) periods as of 09/30/19.
QTR YTD 1YR 3YR 5YR SINCE INCEPT. DATE
International Premier -4.04 16.682.2210.089.167.16 12/31/10
MSCI ACWI x USA SC -1.19 10.28-5.634.643.983.96 N/A

Annual Operating Expenses: Gross 1.34 Net 1.04

NOV YTD 1YR 3YR 5YR SINCE INCEPT. DATE
International Premier 6.03 28.1822.5216.9011.858.16 12/31/10
MSCI ACWI x USA SC 1.67 16.6710.328.665.754.55 N/A

Annual Operating Expenses: Gross 1.34 Net 1.04

DEC YTD 1YR 3YR 5YR SINCE INCEPT. DATE
International Premier 1.16 29.6825.0917.3912.458.29 12/31/10
MSCI ACWI x USA SC 0.56 17.3210.778.905.974.61 N/A

Annual Operating Expenses: Gross 1.34 Net 1.04

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 month-end performance may be higher or lower than performance quoted and may be obtained at www.roycefunds.com. Gross operating expenses reflect the Fund's total gross annual operating expenses for the Institutional Class and include management fees and other expenses. Net 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, without right of termination, to waive fees and/or reimburse expenses to the extent necessary to maintain the Institutional Class's net annual 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) at or below 1.04% through April 30, 2020.

All performance and risk information presented in this material prior to the commencement date of Institutional Class shares on 5/1/18 reflects Service Class results. Service Class shares bear an annual distribution expense that is not borne by Institutional Class shares.

Rolling Returns

On a monthly basis, the Fund outperformed the MSCI ACWI x USA SC in 100% of all 5-Year periods; 84% of all 3-Year periods; and 70% of all 1-Year periods.

Relative Returns: Monthly Rolling Average Annual Return Periods Since Inception Through 09/30/19

periods beating
the index(%)
fund
avg(%)
index
avg(%)
5-year
46/46
100 8.6 5.9
3-year
59/70
84 9.1 6.7
1-year
66/94
70 8.5 5.5

Market Cycle Performance

The Fund outperformed the MSCI ACWI x USA SC from the 1/26/18 index peak through current (9/30/19) and in the previous full market cycle period.
Peak-Peak - 05/15/15 - 01/26/18
International Premier45.8%
MSCI ACWI x USA SC31.9%

Peak-Current - 01/26/18 - 09/30/19
International Premier-4.1%
MSCI ACWI x USA SC-15.2%

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 12/31/10 and 09/30/19

International Premier$18,318.26
MSCI ACWI x USA SC$14,051.39

Risk

Below Average Volatility vs. Peer Group as of 09/30/19

The Fund has a below average volatility within its peer group of 79 International Small-Cap Funds based on 5-year rolling standard deviation.

Down Market Performance Comparisonas of 09/30/19

The Fund outperformed the MSCI ACWI x USA SC during both downturns of 15% or more from the index’s prior historical high since the Fund’s inception.

Market Downturns (%)

DownMarketImg
Outperformed in 9 out of 14 down quarters.

MSCI ACWI x USA SC Down Quarters

QUARTER ENDMSCI ACWI X USA SC (%)INTERNATIONAL PREMIER (%)SPREAD (%)
09/30/19-1.2-4.0-2.8
12/31/18-14.4-12.4+2.0
09/30/18-1.5+3.0+4.5
06/30/18-2.6-3.3-0.7
03/31/18-0.4+0.3+0.7
12/31/16-3.5-6.6-3.1
06/30/16-0.9+2.0+2.9
09/30/15-10.0-5.8+4.2
12/31/14-4.0-5.6-1.6
09/30/14-6.8-5.8+1.0
06/30/13-4.4+0.5+4.9
06/30/12-8.9-5.4+3.5
09/30/11-20.0-20.4-0.4
06/30/11-0.3+1.4+1.7

Capture Ratios Fund's First Full Quarter (12/31/10) to 09/30/19

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 09/30/19

Over the past 5 years, the Fund outperformed the MSCI ACWI ex USA Small Cap Index with lower volatility.
Over the past 3 years, the Fund outperformed the MSCI ACWI ex USA Small Cap Index.
From the Fund's inception, the Fund outperformed the MSCI ACWI ex USA Small Cap Index with lower volatility.

Go to Relative Risk Spectrum Tool

Morningstar Statistical Measures as of 09/30/19

The Fund beat the MSCI ACWI x USA SC and performed within the top 25% of international small-cap objective funds on a risk-adjusted basis, as shown by its Sharpe ratio. In addition, the Fund produced lower volatility than 75% of international small-cap objective funds, as shown by its standard deviation.
The Fund beat the MSCI ACWI x USA SC and performed within the top 25% of international small-cap objective funds on a risk-adjusted basis, as shown by its Sharpe ratio. In addition, the Fund produced lower volatility than the MSCI ACWI x USA SC and 75% of international small-cap objective funds, as shown by its standard deviation.
Sharpe RatioStandard Deviation
International Premier0.7112.01
MSCI ACWI x USA SC0.3012.29
Category Median0.3012.60
Best Quartile Breakpoint0.4212.08

Category Median and Best Quartile Breakpoint based on 79 international small-cap objective funds (oldest class only) with at least five years of history.
Sharpe Ratio Standard Deviation
International Premier
MSCI ACWI x USA SC
Category Median
Best Quartile Breakpoint

Composition

Morningstar Style Map™as of 09/30/19

mstar-RIPIX

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 09/30/19

  RIPIX MSCI ACWI x USA SC
Average Market Cap
2.00B
1.70B
99%
-
2018 Portfolio Turnover
65%
-
Weighted Average P/E,
24.3x
14.5x
Weighted Average P/B,
3.7x
1.6x
Non-U.S. Investments (% of Net Assets)
97.9%
-
U.S. Investments (% of Net Assets)
0.0%
-

Portfolio Allocation

  • Total
    Holdings
    51


SECTORS
RIPIX (%) MSCI
ACWI X USA SC (%)
Industrials
40.9
19.1
Information Technology
22.0
10.5
Health Care
12.2
7.1
Materials
10.5
9.9
Financials
7.2
10.2
Energy
3.1
3.3
Real Estate
2.0
12.8
Consumer Discretionary
-
12.5
Consumer Staples
-
6.3
Communication Services
-
4.8
Utilities
-
3.4
Cash and Cash Equivalents
2.1
-
POSITIONS% OF NET ASSETS
(SUBJECT TO CHANGE)
Loomis Cl. B
3.0
IMCD
3.0
Victrex
2.9
Daifuku
2.9
Partners Group Holding
2.8
Hexpol
2.7
Croda International
2.6
TKC Corporation
2.6
VZ Holding
2.4
Hansen Technologies
2.3
TravelSky Technology
2.3
FUCHS PETROLUB
2.3
Intertrust
2.2
TOTVS
2.2
TGS-NOPEC Geophysical
2.1
Spirax-Sarco Engineering
2.1
Meitec Corporation
2.1
Altus Group
2.0
Bravida Holding
2.0
Benefit One
2.0
Top 20 as % of Net Assets
48.5

SECTORS
RIPIX (%) MSCI
ACWI X USA SC (%)
Industrials
39.5
-
Information Technology
19.4
-
Health Care
10.9
-
Materials
10.2
-
Financials
5.7
-
Energy
2.0
-
Real Estate
1.7
-
Cash and Cash Equivalents
10.5
-
POSITIONS% OF NET ASSETS
(SUBJECT TO CHANGE)
IMCD
3.0
Victrex
2.9
Daifuku
2.7
Loomis Cl. B
2.6
Hexpol
2.5
Croda International
2.5
FUCHS PETROLUB
2.4
TKC Corporation
2.3
TOTVS
2.2
Spirax-Sarco Engineering
2.1
Top 10 as % of Net Assets
25.2

Portfolio Holdings

View the complete list of holdings for this fund as of 09/30/19. Unaudited schedule of portfolio holdings is presented for informational purposes only.

Geographical Breakdown

Portfolio Country Breakdownas of 09/30/19

Countries% of net assets
(subject to change)
Japan17.6
United Kingdom12.4
Switzerland10.2
Sweden9.4
Australia9.0
Germany7.7
Netherlands5.2
Canada5.0
Brazil4.0
France3.7
China2.3
Norway2.1
Singapore1.9
Italy1.9
India1.8
New Zealand1.8
Denmark1.7

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 ($) REINVEST
PRICE ($)
12/12/18 12/13/18 12/13/18 0.0619 0.0000 0.0000 - 0.0619 11.66

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 1.00
Distribution (12b-1) fees 0.00
Other expenses 0.34
Total annual Fund operating expenses 1.34
Fee waivers and/or expense reimbursements (0.30)
Total annual Fund operating expenses after fee waivers and/or expense reimbursements1.04

Royce & Associates has contractually agreed, without right of termination, to waive fees and/or reimburse expenses to the extent necessary to maintain the Institutional Class’s net annual 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) at or below 1.04% through April 30, 2020.

Important Disclosure Information

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.

The Fund may invest a significant portion of its assets in foreign companies which 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. These risk factors may affect the prices of foreign securities issued by companies headquartered in developing countries more than those headquartered in developed countries. (Please see "Investing in Foreign Securities" in the prospectus.) Therefore, the prices of the securities of foreign companies in particular countries or regions may, at times, move in a different direction than those of the securities of U.S. companies. (Please see “Primary Risks for Fund Investors” in the prospectus.) The Fund invests primarily in small-cap stocks, which may involve considerably more risk than investing in larger-cap stocks. The Fund also generally invests a significant portion of its 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 one of these stocks would cause the Fund's overall value to decline to a greater degree. (Please see "Primary Risks for Fund Investors" 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.
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.
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. The performance of an index does not represent exactly any particular investment, as you cannot invest directly in an index.

Managed by Mark Rayner since 2016 (assistant portfolio manager from 2014 to 2015)

5/1/2018 12:00:00 AM

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