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Mid Cap Relative Value Fund

Mutual Funds

Mid Cap Relative Value Fund


Fund Managers

Photo of Andrew  DiZio

Andrew DiZio, CFA®

Overview

C
Shares

STRNX

Inception
Date

11.16.2015

Investment
Min.

$1,000

Subsequent
Investment Min.1

N/A

Max. Up Front
Sales Charge

N/A

Max. Deferred
Sales Charge

1%

1If subsequent investments are made as part of an AIP, the minimum is $25.

Philosophy & Process

The Fund uses a value investment approach to invest primarily in common stocks of mid-size companies. We believe that undervalued companies with good earnings prospects have superior appreciation potential with reasonable levels of risk. Quantitatively, we focus on a stock's fundamental valuation relative to its peers. Qualitatively, we seek to identify business catalysts which will serve to drive future earnings growth, increase investor interest and expand valuation.

Within the US equity universe, it is our view that the Mid Cap segment offers an attractive mix of growth and stability. Compared to smaller peers, Mid Cap stocks are more likely to have proven business models and greater financial flexibility, yet in many cases, still have the potential for rapid growth. As a result, over longer periods of time, Mid Cap stocks have exhibited superior risk-adjusted returns versus both Small Caps and Large Caps.

Investment Considerations

Mid-size company stocks are generally riskier than large company stocks due to greater volatility and less liquidity. Value stocks can perform differently than other types of stocks and can continue to be undervalued by the market for long periods of time.

Fund Facts

Term Class A Shares Class C Shares Class I Shares
Ticker STRLXSTRNXSTRGX
Inception Date 11.16.201511.16.201509.30.1972
Investment Min. $1,000$1,000$1,000,000
Subsequent Investment Min.2 N/AN/AN/A
Max. Up Front Sales Charge 5.75%N/AN/A
Max. Deferred Sales Charge N/A1%N/A

2If subsequent investments are made as part of an AIP, the minimum is $25.

Mid Cap Relative Value Fund

Management

View professional designations disclosures

Photo of Andrew  DiZio

Andrew DiZio, CFA®

Portfolio Manager

Performance

Fund Performance as of 06.30.2024

Term QTR YTD 1 Year 3 Years 5 Years 10 Years Since Inception
A Shares with 5.75% Sales Charge -10.00% -1.68% 5.49% 1.54% 7.05% 6.41% 9.89%
A Shares without Sales Charge -4.51% 4.31% 11.94% 3.57% 8.33% 7.04% 10.01%
Institutional Shares -4.44% 4.45% 12.23% 3.83% 8.60% 7.28% 10.06%
Lipper Mid-Cap Core 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 are 1.10%, 1.85% and 0.85%, respectively.

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 inception date for Class A Shares is 11.16.2015. The inception date for Class C Shares is 11.16.2015. The inception date for Class Inst'l Shares is 09.30.1972. Because Class A Shares and Class C Shares do not have a full calendar year of performance, the historical performance shown is that of Institutional Shares. Class A Shares and Class C Shares and Institutional Shares of the Fund would have substantially similar performance because the Shares are invested in the same portfolio of securities and the performance would differ only to the extent that the Classes have different expenses.

The performance shown prior to November 16, 2015 is that of the Stratton Mid Cap Value Fund (the "Predecessor Fund") which reorganized into the Sterling Capital Stratton Mid Cap Value Fund Institutional Shares (the Fund). Because the Fund had no investment operations prior to the closing of the reorganization, and based on the similarity of the Fund to the Predecessor Fund, the Predecessor Fund is treated as the survivor of the reorganization for accounting and performance reporting purposes. The inception date of the Predecessor Fund is 9/30/1972.

Effective November 16, 2015, Sterling Capital Management changed the name of the Stratton Mid Cap Value Fund to the Sterling Capital Stratton Mid Cap Value Fund. The name was changed as a result of the Stratton Fund being reorganized into the Sterling Capital Funds.

Effective May 1, 2013, Stratton Management changed the name of the Stratton Multi-Cap Fund to the Stratton Mid Cap Fund. The name has been changed to more appropriately reflect the characteristics and securities of the Fund. The investment objective remains the same.

Characteristics

Top Ten Holdings as of 03.31.2024

# Company Name Value
1 Carlisle Cos., Inc. 3.69%
2 Icon Plc 3.41%
3 Fiserv, Inc. 3.35%
4 United Rentals, Inc. 3.25%
5 Ameriprise Financial, Inc. 3.18%
6 Caci International, Inc. 3.14%
7 Casey'S General Stores, Inc. 3.02%
8 Performance Food Group Co 2.91%
9 Nvent Electric Plc 2.87%
10 Phillips 66 2.84%

Current and future portfolio holdings are subject to change and risk. Based on Market Value of securities.

Sector Allocation as of 03.31.2024

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 03.31.2024

The Growth of $10,000 is hypothetical based upon the performance of net A Shares at NAV for the period ended 03.31.2024. It includes the reinvestment of dividends and capital gains.

Statistics

Risk/Return Statistics vs. Russell Midcap® Value Index 3 as of 03.31.2024

Term Value
Alpha 0.09
Beta 0.92
R-Squared 95.09
Standard Deviation 16.61
Sharpe Ratio 0.40

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.

Summary Statistics as of 03.31.2024

Term Value
Weighted Median P/E 25.31
Weighted Average P/B 2.54
Weighted Average Market Cap $27.21B
Annual Turnover 6%

Equity Funds

Insights

07.03.2024 • Charles Wittmann, CFA®

The Lead - "Going for Gold"

- Economic indicators such as gross domestic product and the Institute for Supply Management Manufacturing Index recently showed slowing growth, while the Consumer Price Index remains stubbornly above the Federal Reserve’s target rate. Concerns over slowing economic growth amidst higher inflation, also known as stagflation, have emerged. - In such a scenario, we would note that quality and cash deployment (dividends and share buybacks) shine in a slow growth, higher inflation environment. - The problem recently is that the slowing economy has led to a slowdown in cash returned to shareholders in the form of dividends and share buybacks by the market. - We believe in the importance of preparation for potential uphill climbs as well as the value in finding investments that raise their cash returns to shareholders.

07.02.2024

Sterling Capital Management LLC joins Guardian Capital Group Limited

Sterling Capital Management LLC announced today the completion of its acquisition by Guardian Capital LLC, a wholly-owned subsidiary of global asset manager Guardian Capital Group Limited.

07.02.2024

Sterling Capital joins Guardian Capital Group Limited

“We are thrilled to announce the completion of Sterling’s acquisition by Guardian Capital Group, a global asset manager. We are also thankful to join an organization that shares our culture and values in protecting our clients’ assets - and we are truly excited for our bright future together!” – Scott Haenni, Sr. Managing Director & CEO at Sterling Capital Management

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06.27.2024 • Jeffrey Ormsby, CFA®

Fixed Income and Federal Reserve Rate Cuts: How Should We Expect Fixed Income to Perform?

As one would expect, in most historical periods where interest rates were declining, fixed income total return has been good, with investors capturing the coupon income as well as benefiting from the increase in prices as rates fall. Looking at the history of the Bloomberg Aggregate Bond Index since 1988, in the previous five Federal Reserve (Fed) rate-cutting cycles, the index posted annualized returns averaging north of 8%.

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06.13.2024 • Andrew Richman, CTFA

When It Comes to Fed Policy, Follow the Data, Not the Dots

Andy Richman's update on the June Federal Open Market Committee meeting.

06.05.2024 • Charles Wittmann, CFA®

The Lead - "An Indicator of Business Confidence"

- Several notable companies have elected to inaugurate a quarterly dividend this year, while 47 companies in the U.S. stopped paying dividends during the COVID-19 crisis and have yet to reinstitute one. Why? - We would suggest it comes down to the ability to pay an ever-increasing dividend alongside their confidence in their business’s future. - In the current period of fewer dividend initiations, slower dividend growth in the market, and household names cutting their dividends, we believe there are several lessons to learn.

Contact

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