David Nadel on WealthTrack: Exploring the Value of International Small-Caps
article 03-08-2016

David Nadel on WealthTrack: Exploring the Value of International Small-Caps

In his WealthTrack interview Portfolio Manager David Nadel tells Consuelo Mack why he believes the current market turmoil is not a test of fundamentals and then discusses the attractive qualities he sees in the international small-cap market.  


DAN - WealthTrack - 1a

Courtesy of Consuelo Mack WealthTrack. All Rights Reserved.

Portfolio Manager and Director of International Research David Nadel sat down with host Consuelo Mack on WealthTrack, originally broadcast on February 19, 2016, to discuss trends in the international small-cap market, why international small-cap companies are valuable, and the investment strategy of Royce International Premier Fund.

In reviewing the current concerns about market turmoil, David believes the current situation is credit related rather than one that is more fundamental.

After lagging their domestic cousins for a few years, both the Russell Global ex-U.S. Small Cap and the Russell Europe Small Cap Indexes outperformed the Russell 2000 in 2015 and have so far done the same in 2016. David details the qualities he looks for in companies and describes some of the attributes of current portfolio holdings.

He asserts, "We are much more interested in the actual operating results of businesses and their ability to sustain or possibly improve the moat surrounding their business, rather than short-term price action."

David Nadel joined Royce in 2006 and has 23 years of investment industry experience.

Important Disclosure Information

David Nadel is Director of International Research and a Portfolio Manager of Royce & Associates, LP, investment adviser to The Royce Funds. He is the portfolio manager of Royce International Premier Fund (RIP. He also assists Royce Global Value Trust (RGT), and Royce Value Trust (RVT). The thoughts and opinions expressed in the video are solely those of the person speaking and may differ from those of other Royce investment professionals, or the firm as a whole. There can be no assurance with regard to future market movements. 

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. Royce International Premier 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, currency 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 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 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.)

Average Annual Total Returns (%) as of 12/31/15

International Premier 8.57 16.42 8.27 5.45 5.45 12/31/10
Russell Glo x US SC 5.11 0.50 4.32 1.87 1.87 N/A
Annual Operating Expenses: Gross 2.93% Net 1.19

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 2% 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. Gross operating expenses reflect the Fund's total gross annual operating expenses 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 to waive fees and/or reimburse operating expenses to the extent necessary to maintain the Fund'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 1.29% through April 30, 2016 and at or below 1.74% through April 30, 2025.

All performance and risk information presented in this material prior to the commencement date of Investment Class shares on 1/15/14 reflects Service Class results. Shares of the Fund's Service Class bear an annual distribution expense that is not borne by the Investment Class.

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 that measures the performance of the 2,000 smallest publicly traded U.S. companies in the Russell 3000 index. The Russell Europe Small Cap Index is an unmanaged, capitalization-weighted index of European small-cap stocks. The Russell Global Small Cap Index is an unmanaged, capitalization-weighted index of global small-cap stocks. The Russell Global ex-U.S. 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.



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