Mutual Funds
Behavioral Small Cap Value Equity Fund
Fund Managers
Robert Bridges, CFA®
Robert Weller, CFA®
Overview
I
Shares
SPSCX
Inception
Date
01.02.1997
Investment
Min.
$1,000,000
Subsequent
Investment Min.1
N/A
Max. Up Front
Sales Charge
N/A
Max. Deferred
Sales Charge
N/A
1If subsequent investments are made as part of an AIP, the minimum is $25.
Philosophy & Process
The investment team applies "behavioral finance" principles in constructing the Fund's portfolio. Behavioral finance theorizes that investment decisions are often influenced by emotion, and that investors can be both predictable and irrational at times in their decision making. Emotional investment decisions can lead to stock price anomalies that create buying opportunities in the marketplace. The Team seeks to capitalize on these behaviorally driven anomalies by employing a disciplined investment process that ranks companies in the Behavioral Small Cap Value Fund's investment universe. Factors in the process include valuation, price momentum and earnings revisions. The Team also takes into account factors such as market capitalization and sector exposure in building a diversified portfolio.
Investment Considerations
The overall results of the Fund will be dependent on the process and ability of the Adviser to apply “behavioral finance” principles to recognize a company's value, earnings revisions and price momentum. The Fund may invest in undervalued securities which may not appreciate in value as anticipated or remain undervalued for longer than anticipated. The overall results of the fund will be dependent on the process and ability of the Adviser to recognize a company’s value. The Fund may invest in REITs (Real Estate Investment Trusts), the value of which will be affected by conditions of the real estate industry and exchange-traded funds (ETFs), thus shareholders may bear additional costs and the ETF may not exactly replicate the performance it seeks to track.
| Term | Class A Shares | Class C Shares | Class I Shares | Class R6 Shares |
|---|---|---|---|---|
| Ticker | SPSAX | SPSDX | SPSCX | STRBX |
| Inception Date | 02.01.2010 | 02.01.2010 | 01.02.1997 | 02.01.2018 |
| Investment Min. | $1,000 | $1,000 | $1,000,000 | N/A |
| Subsequent Investment Min.2 | N/A | N/A | N/A | N/A |
| Max. Up Front Sales Charge | 5.75% | N/A | N/A | N/A |
| Max. Deferred Sales Charge | N/A | 1% | N/A | N/A |
2If subsequent investments are made as part of an AIP, the minimum is $25.
Co-Portfolio Manager
Co-Portfolio Manager
Performance
| Term | QTR | YTD | 1 Year | 3 Years | 5 Years | 10 Years | Since Inception |
|---|---|---|---|---|---|---|---|
| A Shares with 5.75% Sales Charge | -8.43% | -4.17% | 9.59% | 2.42% | 7.94% | 6.00% | 8.80% |
| A Shares without Sales Charge | -2.85% | 1.70% | 16.25% | 4.46% | 9.22% | 6.64% | 9.04% |
| Institutional Shares | -2.77% | 1.83% | 16.53% | 4.73% | 9.50% | 6.90% | 9.18% |
| Lipper Small-Cap Value Median | N/A | N/A | N/A | N/A | N/A | N/A | N/A |
The total expense ratios for Class A, C and I Shares are 1.10%, 1.85% and 0.85%, respectively. The gross expense ratio for Class R6 Shares is 0.85%. The net expense ratio for Class R6 Shares is 0.78%.
The Fund Administrator, Sterling Capital Management LLC, has contractually agreed to waive its administrative fees, pay Fund operating expenses, and/or reimburse the Fund .07% of the Class R6 avg. daily net assets for the period 02.01.2024-01.31.2025. Performance would have been lower without limitations in effect.
Past performance does not guarantee future results. The performance data quoted represents past performance and current returns may be lower or higher. The investment return and principal value of an investment will fluctuate so that an investor's shares, when redeemed, may be worth more or less than the original cost. To obtain performance information current to the most recent month end, please visit the performance summary.
The performance of the Sterling Capital Behavioral Small Cap Value Equity Fund reflects the deduction of fees for value-added services associated with a mutual fund, such as investment management and fund accounting fees. The inception date for Class A Shares is 02.01.2010. The inception date for Class C Shares is 02.01.2010. The inception date for Class Inst'l Shares is 01.02.1997. The inception date for Class R6 Shares is 02.01.2018. The performance shown reflects the reinvestment of all dividend and capital gains distributions. Performance is annualized for periods greater than one year.
Performance for Class A Shares for periods prior to inception is based on the performance of the Institutional Shares of the Fund. The performance information for the Institutional Shares prior to 12.18.2006 is based on the performance of the Institutional Shares of the Fund’s predecessor, Sterling Capital Small Cap Value Fund, a series of The Advisors’ Inner Circle Fund (the “Predecessor Fund”), which transferred all of its assets and liabilities to the Fund pursuant to a reorganization. Information prior to 03.16.2001 relates to the UAM Fund Inc.’s Sterling Partners’ Small Cap Value Portfolio, the assets of which were acquired by the Predecessor Fund. Effective 02.01.2010, the Sterling Shares of the Fund were renamed Institutional Shares.
Characteristics
| # | Company Name | Value |
|---|---|---|
| 1 | Jackson Financial Inc | 0.98% |
| 2 | Boise Cascade Co. | 0.97% |
| 3 | Mr Cooper Group Inc | 0.93% |
| 4 | Mueller Industries Inc | 0.79% |
| 5 | Taylor Morrison Home Corp. | 0.78% |
| 6 | Skywest, Inc. | 0.77% |
| 7 | Otter Tail Corp | 0.77% |
| 8 | Old National Bancorp | 0.76% |
| 9 | Matson Inc. | 0.75% |
| 10 | UFP Industries, Inc. | 0.74% |
Current and future portfolio holdings are subject to change and risk. Based on Market Value of securities.
Sector Allocation as of 06.30.2024
Allocations are based on the current weight to funds in the cited Sector. The composition of the fund's holdings is subject to change.
Growth of $10,000 as of 06.30.2024
The Growth of $10,000 is hypothetical based upon the performance of net A Shares at NAV for the period ended 06.30.2024. It includes the reinvestment of dividends and capital gains.
Statistics
| Term | Value |
|---|---|
| Alpha | 0.65 |
| Beta | 0.97 |
| R-Squared | 96.04 |
| Standard Deviation | 20.51 |
| Sharpe Ratio | 0.25 |
3The Funds composition is subject to change. Annual Turnover Ratio is 12 month rolling calculation. Alpha, Beta, R-Squared, Standard Deviation, and Sharpe Ratio are based on a 10-year calculation.
View a Glossary of Terms.
| Term | Value |
|---|---|
| Weighted Median P/E | 11.36 |
| Weighted Average P/B | 1.30 |
| Weighted Average Market Cap | $4.02B |
| Annual Turnover | 155% |
Behavioral Small Cap Value Equity Fund
Materials
Equity Funds
Insights
09.04.2024 • Charles Wittmann, CFA®
The Lead - Dividend Opportunities
- As we enter September, it appears the Federal Reserve is prepared to lower the federal funds rate at their September 18, 2024 meeting. - Historically, dividend payers have outperformed non-dividend payers after the first cut. - One may question if historically it has been better to own high yielders versus dividend growers, and if it has been better to own slower or faster dividend growers. We address these topics in this month’s piece.
08.29.2024
Guardian Capital buys Sterling Capital Management from Truist
(pionline.com) Guardian Capital, a wholly owned subsidiary of Guardian Capital Group, will acquire investment manager Sterling Capital Management from Truist Financial.
08.27.2024 • Andrew DiZio, CFA®
Higher Interest Rates & REITs - Looking Ahead at Lower New Supply
The market has spent much of the last two years fixated on the negative effects of rising rates on Real Estate Investment Trust (REIT) share prices. What has received less attention is the slowdown in new developments of commercial and multifamily real estate due to higher interest rates and the potential for higher rents in coming years should consistent demand growth be unmet by new supply. We believe publicly-traded REITs, which derive much of their earnings growth from existing real estate rather than new development, are overlooked future beneficiaries of this construction slowdown.
08.13.2024
James Kerin, CFA®, Michael McVicker
Energy prepayment (prepay) bonds enable municipal utilities to lock into a discounted price on a long-term supply of energy, most commonly natural gas or electricity. Issued by special purpose authorities, bonds are structured with far-dated final maturities but shorter-dated mandatory tenders that are backed by the obligation of a bank or insurance company, known as the guarantor, to ensure that it occurs in order to return principal to bondholders. As a result, prepay bonds are ultimately a corporate credit exposure in the tax-exempt market. The final maturity matches the term of the energy supply contract and improves the bond’s market discount tax treatment, while the shorter-dated tender serves to optimize borrowing costs within the transaction.
08.01.2024 • Charles Wittmann, CFA®
- Low quality and risk performed well in the first half of 2024. - As a result of more tepid inflation data supporting a potential reduction in the federal funds rate, we believe the market began anticipating that lower rates may aid companies that need stress relief from the higher interest payments placed on their businesses. - Evidence of this stress can be seen in how companies in the S&P 500 Index began reducing the growth rate of dividends they pay their shareholders as cash flows become more difficult to generate. - We believe quality companies that increase rather than decrease their dividends and signal their financial strength through short- and long-term environments may be a formula for client success.
08.01.2024 • Andrew Richman, CTFA
“Better Balance” Increases the Odds for a September Cut
Andy Richman's update on the July Federal Open Market Committee meeting.
Contact
Learn more about Sterling Capital solutions and services.
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The Morningstar Rating™ for funds, or "star rating", is calculated for managed products (including mutual funds, variable annuity and variable life subaccounts, exchange-traded funds, closed-end funds, and separate accounts) with at least a three-year history. Exchange-traded funds and open-ended mutual funds are considered a single population for comparative purposes. It is calculated based on a Morningstar Risk-Adjusted Return measure that accounts for variation in a managed product's monthly excess performance, placing more emphasis on downward variations and rewarding consistent performance. The top 10% of products in each product category receive 5 stars, the next 22.5% receive 4 stars, the next 35% receive 3 stars, the next 22.5% receive 2 stars, and the bottom 10% receive 1 star. The Overall Morningstar Rating for a managed product is derived from a weighted average of the performance figures associated with its three-, five-, and 10-year (if applicable) Morningstar Rating metrics. The weights are: 100% three-year rating for 36-59 months of total returns, 60% five-year rating/40% three-year rating for 60-119 months of total returns, and 50% 10-year rating/30% five-year rating/20% three-year rating for 120 or more months of total returns. While the 10-year overall star rating formula seems to give the most weight to the 10-year period, the most recent three-year period actually has the greatest impact because it is included in all three rating periods.
