2
06/30/15
08/31/15
09/01/15
11/19/1996

At a Glance

Why invest in Opportunity?

  • Investment goal of long-term growth of capital
  • Broadly diversified portfolio, theme-based, opportunistic value approach
  • Invests primarily in small-cap stocks, up to $3 billion
  • Buzz Zaino lead manager since 2013 (manager 1998-2013), Bill Hench since 2013 (assistant portfolio manager 2004-2013)

As of 06/30/15

Portfolio Management





Performance

Average Annual Total Returns (%)

Outperformed Russell 2000 for the 10-Year, 15-Year and since inception (11/19/96) periods as of 06/30/15.
QTR YTD 1YR 3YR 5YR 10YR 15YR SINCE INCEPT. DATE
Opportunity -0.44 0.67-2.7516.5815.628.5810.4012.67 11/19/96
Russell 2000 0.42 4.756.4917.8117.088.407.508.57 N/A

Annual Operating Expenses: 1.15

AUG YTD 1YR 3YR 5YR 10YR 15YR SINCE INCEPT. DATE
Opportunity -4.40 -9.51-11.2012.2513.416.839.0111.91 11/19/96
Russell 2000 -6.28 -2.970.0314.1215.557.126.668.04 N/A

Annual Operating Expenses: 1.15

SEP YTD 1YR 3YR 5YR 10YR 15YR SINCE INCEPT. DATE
Opportunity -2.71 -11.96-13.6111.2211.876.508.7611.75 11/19/96
Russell 2000 -2.71 -5.59-2.6813.0914.066.796.417.88 N/A

Annual Operating Expenses: 1.15

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. Shares redeemed within 30 days of purchase may be subject to a 1% redemption fee, payable to the Fund, which is not reflected in the performance shown above; if it were, performance would be lower. Current month-end performance may be higher or lower than performance quoted and 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 and 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 indirectly by the Fund through its investments in mutual funds, hedge funds, private equity funds, and other investment companies.

Rolling Returns

On a monthly basis, the Fund outperformed the Russell 2000 in 99% of all 10-Year periods; 84% of all 5-Year periods; and 69% of all 1-Year periods.

For 100% of the periods, 10-year average annual total returns were greater than 5%.

Relative Returns: Monthly Rolling Average Annual Return Periods Since Inception Through 06/30/15

periods beating
the index(%)
fund
avg(%)
index
avg(%)
10-year
103/104
99 10.9 7.0
5-year
137/164
84 11.9 7.2
1-year
146/212
69 15.9 10.0

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% 49 47
> 5% and ≤ 10% 55 53
> 0% and ≤ 5% 0 0
≤ 0% 0 0

The Fund averaged a 10.9% return over all 104 10-year monthly rolling return periods.

Market Cycle Performance

The Fund outperformed the Russell 2000 from the 03/09/00 index peak through 06/30/15 and in each of the two previous full market cycle periods.
Peak-Peak - 03/09/00 - 07/13/07
Opportunity191.8%
Russell 200054.8%

Peak-Peak - 07/13/07 - 04/29/11
Opportunity6.9%
Russell 20006.6%

Peak-Current - 04/29/11 - 06/30/15
Opportunity42.2%
Russell 200053.5%

Royce defines market cycles as peak-to-peak periods in which a peak is the market high prior to a decline of at least 15%. 

Royce defines market cycles as peak-to-peak periods in which a peak is the market high prior to a decline of at least 15%. 

Calendar Year Total Returns (%)

 

Growth of Investment

Value of $10,000 invested between 11/19/96 and 06/30/15

Opportunity$92,119.81
Russell 2000$46,163.67

Portfolio Impactas of 06/30/15

SECTOR NAMEAVERAGE WEIGHT (%)TOTAL RETURN (%)CONTRIBUTION TO RETURN (%)
Industrials
21.10
3.65
0.74
Materials
7.96
2.73
0.19
Financials
11.17
1.58
0.18
Health Care
3.66
2.82
0.10
Utilities
0.16
2.96
0.00
Telecommunication Services
0.69
-6.39
-0.04
Energy
2.02
-2.72
-0.07
Consumer Staples
1.78
-6.61
-0.11
Consumer Discretionary
15.35
-2.79
-0.44
Information Technology
30.67
-2.25
-0.66
Cash
5.44
0.00
0.00

Top Contributors

INDUSTRYSECTORGAIN (%)
BanksFinancials0.40
Internet Software & ServicesInformation Technology0.35
Commercial Services & SuppliesIndustrials0.35
ChemicalsMaterials0.31
Thrifts & Mortgage FinanceFinancials0.29

Top Detractors

INDUSTRYSECTORGAIN (%)
Electronic Equipment, Instruments & ComponentsInformation Technology-0.68
InsuranceFinancials-0.34
Internet & Catalog RetailConsumer Discretionary-0.25
IT ServicesInformation Technology-0.23
Auto ComponentsConsumer Discretionary-0.20

Top Contributors

COMPANYINDUSTRYSECTORGAIN (%)
EarthLink HoldingsInternet Software & ServicesInformation Technology0.29
Builders FirstSourceBuilding ProductsIndustrials0.21
MaxLinear Cl. ASemiconductors & Semiconductor EquipmentInformation Technology0.19
Ferro CorporationChemicalsMaterials0.17
Layne ChristensenConstruction & EngineeringIndustrials0.15

Top Detractors

COMPANYINDUSTRYSECTORGAIN (%)
EVINE LiveInternet & Catalog RetailConsumer Discretionary-0.22
Noranda Aluminum Holding CorporationMetals & MiningMaterials-0.20
MBIAInsuranceFinancials-0.20
SunEdison SemiconductorSemiconductors & Semiconductor EquipmentInformation Technology-0.19
Century AluminumMetals & MiningMaterials-0.15
SECTOR NAMEAVERAGE WEIGHT (%)TOTAL RETURN (%)CONTRIBUTION TO RETURN (%)
Industrials
20.61
4.71
0.90
Health Care
3.72
13.59
0.47
Consumer Discretionary
15.01
2.16
0.34
Financials
11.06
1.38
0.14
Information Technology
31.09
-0.25
0.04
Utilities
0.11
24.15
0.02
Materials
7.73
1.04
0.02
Telecommunication Services
0.67
-6.77
-0.04
Consumer Staples
1.63
-7.26
-0.12
Energy
2.03
-12.88
-0.31
Cash
6.34
0.01
0.00

Top Contributors

INDUSTRYSECTORGAIN (%)
Semiconductors & Semiconductor EquipmentInformation Technology1.14
Commercial Services & SuppliesIndustrials0.74
Household DurablesConsumer Discretionary0.65
BanksFinancials0.52
Internet Software & ServicesInformation Technology0.42

Top Detractors

INDUSTRYSECTORGAIN (%)
Electronic Equipment, Instruments & ComponentsInformation Technology-0.96
Metals & MiningMaterials-0.43
IT ServicesInformation Technology-0.39
Technology Hardware Storage & PeripheralsInformation Technology-0.33
InsuranceFinancials-0.33

Top Contributors

COMPANYINDUSTRYSECTORGAIN (%)
RTI International MetalsMetals & MiningMaterials0.42
TRC CompaniesCommercial Services & SuppliesIndustrials0.31
InterfaceCommercial Services & SuppliesIndustrials0.31
EarthLink HoldingsInternet Software & ServicesInformation Technology0.30
NeoPhotonics CorporationSemiconductors & Semiconductor EquipmentInformation Technology0.26

Top Detractors

COMPANYINDUSTRYSECTORGAIN (%)
Century AluminumMetals & MiningMaterials-0.42
Silicon Graphics InternationalTechnology Hardware Storage & PeripheralsInformation Technology-0.29
McClatchy Company (The) Cl. AMediaConsumer Discretionary-0.27
Noranda Aluminum Holding CorporationMetals & MiningMaterials-0.24
IdentivElectronic Equipment, Instruments & ComponentsInformation Technology-0.23
SECTOR NAMEAVERAGE WEIGHT (%)TOTAL RETURN (%)CONTRIBUTION TO RETURN (%)
Information Technology
30.17
5.32
1.94
Industrials
20.65
3.31
0.80
Financials
10.92
3.99
0.57
Health Care
3.96
9.94
0.32
Telecommunication Services
0.64
6.89
0.06
Utilities
0.06
24.15
0.02
Consumer Staples
1.38
-1.66
-0.02
Consumer Discretionary
14.01
-3.35
-0.33
Materials
8.47
-5.62
-0.75
Energy
3.03
-61.77
-3.88
Cash
6.73
0.02
0.00

Top Contributors

INDUSTRYSECTORGAIN (%)
Semiconductors & Semiconductor EquipmentInformation Technology2.30
Commercial Services & SuppliesIndustrials0.81
Building ProductsIndustrials0.76
BanksFinancials0.71
Air Freight & LogisticsIndustrials0.59

Top Detractors

INDUSTRYSECTORGAIN (%)
Oil, Gas & Consumable FuelsEnergy-1.97
Energy Equipment & ServicesEnergy-1.92
Metals & MiningMaterials-1.11
Electronic Equipment, Instruments & ComponentsInformation Technology-0.99
MarineIndustrials-0.74

Top Contributors

COMPANYINDUSTRYSECTORGAIN (%)
RF Micro DevicesSemiconductors & Semiconductor EquipmentInformation Technology0.51
RTI International MetalsMetals & MiningMaterials0.38
EarthLink HoldingsInternet Software & ServicesInformation Technology0.37
TRC CompaniesCommercial Services & SuppliesIndustrials0.32
Advanced Energy IndustriesSemiconductors & Semiconductor EquipmentInformation Technology0.30

Top Detractors

COMPANYINDUSTRYSECTORGAIN (%)
McClatchy Company (The) Cl. AMediaConsumer Discretionary-0.48
Swift EnergyOil, Gas & Consumable FuelsEnergy-0.41
Goodrich PetroleumOil, Gas & Consumable FuelsEnergy-0.39
Pengrowth EnergyOil, Gas & Consumable FuelsEnergy-0.36
Northwest PipeConstruction & EngineeringIndustrials-0.34
SECTOR NAMEAVERAGE WEIGHT (%)TOTAL RETURN (%)CONTRIBUTION TO RETURN (%)
Industrials
19.99
88.73
16.60
Information Technology
26.56
63.17
15.27
Consumer Discretionary
15.23
74.79
13.12
Financials
12.26
69.14
8.94
Materials
8.49
52.85
5.37
Health Care
4.31
139.41
4.72
Energy
4.73
-20.97
1.08
Utilities
0.02
24.15
0.02
Telecommunication Services
0.47
6.02
0.01
Consumer Staples
0.96
4.86
-0.18
Cash
6.97
0.13
0.01
Unclassified
0.00
0.00
0.00

Top Contributors

INDUSTRYSECTORGAIN (%)
Semiconductors & Semiconductor EquipmentInformation Technology9.11
MachineryIndustrials6.01
Building ProductsIndustrials4.16
ChemicalsMaterials3.93
BanksFinancials3.69

Top Detractors

INDUSTRYSECTORGAIN (%)
MarineIndustrials-0.62
Electrical EquipmentIndustrials-0.24
Personal ProductsConsumer Staples-0.21
Metals & MiningMaterials-0.20
Food & Staples RetailingConsumer Staples-0.12

Top Contributors

COMPANYINDUSTRYSECTORGAIN (%)
SunEdisonSemiconductors & Semiconductor EquipmentInformation Technology1.67
SunPower CorporationSemiconductors & Semiconductor EquipmentInformation Technology1.33
Radian GroupThrifts & Mortgage FinanceFinancials1.20
Albany Molecular ResearchLife Sciences Tools & ServicesHealth Care1.13
UnifiTextiles, Apparel & Luxury GoodsConsumer Discretionary0.97

Top Detractors

COMPANYINDUSTRYSECTORGAIN (%)
Walter EnergyMetals & MiningMaterials-0.65
MBIAInsuranceFinancials-0.64
Swift EnergyOil, Gas & Consumable FuelsEnergy-0.53
Layne ChristensenConstruction & EngineeringIndustrials-0.33
MolycorpMetals & MiningMaterials-0.32
SECTOR NAMEAVERAGE WEIGHT (%)TOTAL RETURN (%)CONTRIBUTION TO RETURN (%)
Industrials
19.28
192.46
31.82
Information Technology
25.71
95.77
27.08
Consumer Discretionary
17.34
147.65
27.04
Materials
9.51
110.29
12.38
Financials
11.73
94.40
11.77
Health Care
3.76
213.74
6.16
Energy
4.57
-12.66
2.79
Consumer Staples
1.09
45.10
0.49
Telecommunication Services
0.54
45.56
0.30
Utilities
0.02
27.75
0.06
Cash
6.44
0.28
0.03
Unclassified
0.00
-12.14
0.00

Top Contributors

INDUSTRYSECTORGAIN (%)
MachineryIndustrials12.56
Semiconductors & Semiconductor EquipmentInformation Technology11.92
Specialty RetailConsumer Discretionary7.99
ChemicalsMaterials7.60
Electronic Equipment, Instruments & ComponentsInformation Technology6.64

Top Detractors

INDUSTRYSECTORGAIN (%)
MarineIndustrials-1.19
Electrical EquipmentIndustrials-0.49
Diversified Financial ServicesFinancials-0.47
Food & Staples RetailingConsumer Staples-0.27
Consumer FinanceFinancials-0.08

Top Contributors

COMPANYINDUSTRYSECTORGAIN (%)
United RentalsTrading Companies & DistributorsIndustrials2.31
Cost PlusSpecialty RetailConsumer Discretionary2.16
Cambrex CorporationLife Sciences Tools & ServicesHealth Care2.02
Lithia Motors Cl. ASpecialty RetailConsumer Discretionary1.99
Dillard's Cl. AMultiline RetailConsumer Discretionary1.89

Top Detractors

COMPANYINDUSTRYSECTORGAIN (%)
Overseas Shipholding GroupOil, Gas & Consumable FuelsEnergy-1.14
Furniture Brands InternationalHousehold DurablesConsumer Discretionary-0.89
KEMET CorporationElectronic Equipment, Instruments & ComponentsInformation Technology-0.68
Walter EnergyMetals & MiningMaterials-0.65
Talbots (The)Specialty RetailConsumer Discretionary-0.58

Risk

Up Market Performance Comparisonas of 06/30/15

The Fund outperformed the Russell 2000 during all four trough-to-peak periods since the Fund’s inception (11/19/96).
UpMarketImg

Capture Ratios Fund's First Full Quarter (12/31/96) to 06/30/15

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 06/30/15

Over the past 10 years, the Fund outperformed the Russell 2000 Index.
From the Fund's inception, the Fund outperformed the Russell 2000 Index.

Go to Relative Risk Spectrum Tool

Morningstar Statistical Measures as of 06/30/15

Sharpe RatioStandard Deviation
Opportunity0.4124.28
Russell 20000.4419.58
Category Median0.4419.23
Best Quartile Breakpoint0.5118.34

Category Median and Best Quartile Breakpoint based on 315 small-cap objective funds (oldest class only) with at least ten years of history.
Sharpe Ratio Standard Deviation
Opportunity
Russell 2000
Category Median
Best Quartile Breakpoint

Composition

Morningstar Style Map™as of 03/31/15

mstar-RYPNX

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.

Market Cap Exposureas of 06/30/15

  • Avg.
    Market Cap
    $750.4M

Diagnosticsas of 06/30/15

Weighted Avg. P/B
1.8x
2014 Portfolio Turnover
36%
90%

Portfolio Allocation

  • Broadly
    Diversified
  • Total
    Holdings
    279
  • Holdings ≥ 75%
    of Total Investments
    142


SECTORS
RYPNX (%) RUSSELL
2000 (%)
Information Technology
30.5
17.2
Industrials
22.1
12.8
Consumer Discretionary
15.7
14.6
Financials
10.9
24.3
Materials
8.2
4.0
Health Care
3.9
16.0
Energy
2.0
3.9
Consumer Staples
2.0
3.1
Telecommunication Services
0.6
0.8
Utilities
0.2
3.3
Cash and Cash Equivalents
3.9
-
POSITIONS% OF NET ASSETS
(SUBJECT TO CHANGE)
Microsemi Corporation
0.9
Commercial Metals
0.9
General Cable
0.9
Advanced Energy Industries
0.9
Interface
0.8
Encore Wire
0.8
Mueller Industries
0.8
Astec Industries
0.8
TRC Companies
0.8
Invacare Corporation
0.8
Kraton Performance Polymers
0.8
Albany Molecular Research
0.8
Mueller Water Products Cl. A
0.8
Quanex Building Products
0.8
Brooks Automation
0.7
Kaiser Aluminum
0.7
EarthLink Holdings
0.7
Newport Corporation
0.7
NCI Building Systems
0.7
II-VI
0.7
Top 20 as % of Net Assets
15.8

SECTORS
RYPNX (%) RUSSELL
2000 (%)
Information Technology
30.5
17.2
Industrials
22.1
12.8
Consumer Discretionary
15.7
14.6
Financials
10.9
24.3
Materials
8.2
4.0
Health Care
3.9
16.0
Energy
2.0
3.9
Consumer Staples
2.0
3.1
Telecommunication Services
0.6
0.8
Utilities
0.2
3.3
Cash and Cash Equivalents
3.9
-
POSITIONS% OF NET ASSETS
(SUBJECT TO CHANGE)
Microsemi Corporation
0.9
Commercial Metals
0.9
General Cable
0.9
Advanced Energy Industries
0.9
Interface
0.8
Encore Wire
0.8
Mueller Industries
0.8
Astec Industries
0.8
TRC Companies
0.8
Invacare Corporation
0.8
Kraton Performance Polymers
0.8
Albany Molecular Research
0.8
Mueller Water Products Cl. A
0.8
Quanex Building Products
0.8
Brooks Automation
0.7
Kaiser Aluminum
0.7
EarthLink Holdings
0.7
Newport Corporation
0.7
NCI Building Systems
0.7
II-VI
0.7
Top 20 as % of Net Assets
15.8

Portfolio Holdings

View the complete list of holdings for this fund as of 06/30/15. Unaudited schedule of portfolio holdings is presented for informational purposes only.

Least Portfolio Overlap

Greatest Portfolio Overlap

Investment Themes as a Percentage of Assets

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 ($) REINVEST
PRICE ($)
12/16/14 12/17/14 12/17/14 0.0000 0.1123 1.8262 - 1.9385 13.01
12/04/13 12/05/13 12/05/13 0.0000 0.0218 1.5136 - 1.5354 14.84
12/05/12 12/06/12 12/06/12 0.0000 0.1317 0.5382 - 0.6699 11.42
12/07/11 12/08/11 12/08/11 0.0000 - 0.1887 - 0.1887 9.96
12/08/09 12/09/09 12/09/09 0.0010 - - - 0.0010 8.56

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 30 days) 1.00

Annual Fund Operating Expenses (%)

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

Management fees 0.99
Distribution (12b-1) fees 0.00
Other expenses 0.15
Acquired fund fees and expenses 0.01
Total annual Fund operating expenses 1.15
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 carefully before investing or sending money. The Fund invests primarily in small-cap stocks, which may involve considerably more risk than investing in larger-cap stocks. (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.

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 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. Please read the prospectus for a more complete discussion of risk. 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.

Buzz Zaino lead manager since 2013 (manager 1998-2013), Bill Hench since 2013 (assistant portfolio manager 2004-2013)

11/19/1996 12:00:00 AM

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