Royce Small-Cap Fund Underperforms in 2025

Royce Small-Cap Fund Underperforms in 2025
Royce Small-Cap Special Equity Fund gained 3.3% in 2025, significantly lagging its Russell 2000 Value Index benchmark which surged 12.6%. Consumer Discretionary, Industrials, and Financials provided the strongest positive contributions to returns. Materials, Information Technology, and Real Estate sectors weighed most heavily on performance. Mueller Industries, a copper tubing and fittings producer, delivered particularly strong second-half results. Conversely, Sylvamo Corporation, a global uncoated paper producer, emerged as the fund's largest detractor following weak first-quarter earnings. Despite trailing in 2025, the fund has outperformed its benchmark over longer periods including the past twenty and twenty-five years.