318. Uncovering the secrets to consistent market outperformance

Michele Ward shares the secrets behind the impressive performance of the T. Rowe Price US Smaller Companies Equity fund, which has outperformed its benchmark over 1, 3, 5, and 10 years. We explore the fund's philosophy of investing in high-quality companies, letting winners run, and maintaining a balanced approach between growth and value. We also discuss the impact of interest rates on small-cap companies and highlight some unique and diverse investments within the portfolio. What’s covered in this episode: The secret to continued outperformanceThe ability to “run winners”…and how that’s impacted the portfolioThe company that went from $4.5 billion to $30 billionValue or growth: where do opportunities lay today?Why small-caps are due to come back into favourThe impact of interest ratesDo smaller companies have more debt?Case study: Manhattan AssociatesWhy hybrids are more attractive in the USMore about the fund: T. Rowe Price US Smaller Companies Equity has a flexible approach looking for both growth and value opportunities in the small and mid-cap space, to build a diverse portfolio of the best ideas from the vast analyst resource at his disposal. The manager will allow his winners to run as long as he still believes there is a return opportunity. As such, the portfolio is likely to have more of a mid-cap bias than its peers. This approach has borne fruit, with considerable performance coming from stock selection.Learn more on fundcalibre.comPlease remember, we’ve been discussing individual companies to bring investing to life for you. It’s not a recommendation to buy or sell. The fund may or may not still hold these companies at the time of listening. Elite Ratings are based on FundCalibre’s research methodology and are the opinion of FundCalibre’s research team only.