http://www.sec.gov/Archives/edgar/data/709364/000090630412000359/rse497-212.htmEffective after the close of business (4:00 p.m. EST) on Wednesday, February 29, 2012, Royce Special Equity Fund will be open only to existing shareholders and existing relationships.
The Fund will remain open to the following:
Existing investors – in their own name or as a beneficial owner of shares held in someone else’s name – for example, a nominee, custodian or omnibus account holding shares for the benefit of an investor would not be eligible to open a new account for its own benefit or for the benefit of another investor, but the investor would be eligible to open a new account in the Fund;
Registered Investment Advisors with existing clients in the Fund. Registered Investment Advisors who currently have clients in the Fund may open new accounts as well as add to existing accounts in the Fund;
Certain pre-approved asset allocation based investment programs and, for a limited time, initial investments by certain institutional investors approved by the Fund’s investment adviser;
Certain pre-approved “Retirement Plans” offered through certain broker-dealers with accounts held on the books of the Fund through omnibus account arrangements (either at the plan level or at the level of the financial intermediary). “Retirement Plans” include 401(k) plans, 457 plans, employer sponsored 403(b) plans, defined benefit pension plans, profit sharing plans, nonqualified deferred compensation plans, other similar employer-sponsored retirement plans and rollover accounts from such plans to individual retirement vehicles such as Traditional and Roth IRAs.
Existing shareholders in other Royce Funds will not be permitted to open new accounts in Royce Special Equity Fund after February 29, 2012 nor will they be permitted to acquire shares of these Funds by exchange. Fund distributions will continue to be reinvested, unless a shareholder has elected otherwise.
Royce reserves the right to: (i) make additional exceptions that, in its judgment, do not adversely affect its ability to manage the Fund; (ii) reject any investment or refuse any exception, including those detailed above, that it believes will adversely affect its ability to manage the Fund; and (iii) close and re-open the Fund to new or existing shareholders at any time.
February 17, 2012
Comments
http://www.roycefunds.com/Tools/Comparefunds/
Some of the differences in the focused fund category, which it is classified as, is it is less volatile, different manager(s), and different fund category (small blend), market cap., AUM, from the other focused funds to name a few differences.
RYSEX is a focused portfolio focused oriented toward small and micro caps (although the fund can, and has, ventured into the mid-cap and large-cap space). Manager Charlie Dreifus seeks out deep-value plays after intensive research and pouring through its books. In the past, these firms have tended to include a number of micro cap or predominantly family-held companies. Dreifus is not afraid to hold cash if he can't find anything that meets his criteria. Its not unusual to see the fund have a >15% cash stake during market upswings. As a result, the fund lags when the market is rocketing forward, but holds up rather well when the bubble bursts and generates steady, low-volatility returns. I use it as one end of a "barbell" strategy in the domestic small cap sleeve of my portfolio. Of note in this regard is that RYSEX, unlike so many of the Royce funds, is truly a US small/micro cap fund; Dreifus doesn't play the Royce game of letting the fund take on 25-30% international exposure while still benchmarking it to the Rusell 2000. The fund may also be less GARP-y than other Royce offerings.
As mentioned I held RYVFX until recently. The performance was fine, but the fund had gone too much into the midcap space and the AUM growing rapidly with no apparent decrease in fees. I also felt the manager was running too many funds. RYSEX doesn't seem to have these problems. They are closing the fund at around $1 billion and the manager only runs two funds at Royce (with apparently similar strategies).
This seems like it could be an interesting "conservative" small cap holding. I already hold ARIVX so I don't think there is a place for RYSEX in my portfolio, but my be worth a look for other folks.