Charlie Dreifus Talks Small-Caps in a Q&A with Barron’s
article 04-04-2018

Charlie Dreifus Talks Small-Caps in a Q&A with Barron’s

Reshma Kapadia, a Senior Editor at Barron’s asked Charlie Dreifus about “5 Stocks That Should Prosper in a Down Market.”

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Charlie Dreifus participated in a Q&A session with Reshma Kapadia, a Senior Editor at Barron’s, to discuss 5 holdings in Royce Special Equity Fund that he believes can prosper in a down market.

Read the full article here (registration required).

The piece also detailed Charlie’s vast experience as a small-cap value manager, pointing out that he “has gone through numerous market cycles, but has stuck to an approach informed by deep dives into accounting whose end goal is to preserve clients’ money rather than give them fodder for the next cocktail party.”

The piece then delves into his investment thesis on the five companies whose defensive characteristics he likes, his view of current small-cap valuations, and the red flags he sees in financial statements today.

Charlie Dreifus, who has 50 years of investment experience, manages Royce Special Equity Fund and Royce Special Equity Multi-Cap Fund. Steven McBoyle, who has 27 years of investment experience, serves as assistant portfolio manager for Special Equity and Special Equity Multi-Cap. Steven is a portfolio manager on Royce Premier and Royce Small/Mid-Cap Premier Funds.

Important Disclosure Information

Average Annual Total Returns (%) as of 3/31/18

  QTR1 YTD 1YR 3YR 5YR 10YR 15YR SINCE
INCEPT.
DATE
Special Equity -5.00 -5.00 2.80 5.06 7.40 8.76 9.63 9.05 05/01/98
Russell 2000 -0.08 -0.08 11.79 8.39 11.47 9.84 11.50 7.35 N/A
Annual Operating Expenses: 1.17%

 

Not annualized.

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 and other expenses.

As of 3/31/18 the percentage of Royce Special Equity Fund’s assets were as follows: Children’s Place 8.5%; Ennis, EBF 0.6%; Haverty Furniture 1.1%; Capella Education 3.7%; Standard Motor Products 4.8%; Facebook 0%; Amazon 0%; Netflix 0%; Alphabet 0%; Eastman Kodak 0%. Company examples for illustrative purposes only. This does not constitute a recommendation to buy or sell any stock. There can be no assurance that the securities mentioned in this piece will be included in any Fund’s portfolio in the future.

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.)

Royce Special Equity Fund invests primarily in small-cap and micro-cap stocks which may involve considerably more risk than investing in larger-cap stocks. (Please see "Primary Risks for Fund Investors" in the prospectus.) As of 3/31/18 the Fund invested a significant portion of its assets in a limited number of stocks, which may involve considerably more risk than 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.)

 

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