RBC Emerging Markets Ex-China Equity Fund Class A (RECAX)

Overview

The fund is designed specifically for investors looking to diversify their investment portfolio by gaining exposure to emerging markets, excluding China. By focusing primarily on equity securities linked economically to these regions, the fund aims to achieve its investment objectives through a strategy that involves allocating at least 80% of its assets to this investment class. The targeted investments are typically in the form of equity securities issued by mid- to large-capitalization companies, reflecting a blend of growth, value, and stability within the volatile emerging market space. This strategic focus reflects an effort to balance risk and reward, tapping into the growth potential of emerging markets while avoiding exposure to China's unique market dynamics.

Products and Services

• Equity Securities of Mid- to Large-Cap Companies

  The fund primarily invests in equity securities, such as common and preferred stock, of mid- to large-capitalization companies. These securities are chosen based on their potential for growth and stability, providing investors with a balanced approach to investing in emerging markets. The selection process focuses on identifying companies with robust economic ties to emerging market countries, aiming to capitalize on the growth dynamics of these regions while managing risks associated with emerging market investments.

• Convertible Securities

  Convertible securities are a type of investment that offers the potential for capital appreciation of equity securities while also providing the income and stability of fixed-income securities. By including convertible securities in its portfolio, the fund offers investors an additional layer of diversification and the opportunity to benefit from potential upside in the equity markets with some downside protection.

• American, European, and Global Depositary Receipts (ADRs, EDRs, GDRs)

  ADRs, EDRs, and GDRs represent shares in foreign companies and are traded on domestic and global stock exchanges. These instruments allow the fund to invest in a broad range of companies located in emerging markets without the complexities of direct investments in foreign stock markets. This approach broadens the fund's exposure to emerging markets, providing investors with a more diversified and accessible way to invest in foreign equity securities.

• Warrants and Rights

  Warrants and rights offer the holder the right, but not the obligation, to buy or sell a company's stock at a specific price before a certain date. By including these instruments in its investment strategy, the fund can potentially leverage these options to capitalize on market movements, offering potential for higher returns while also introducing an additional layer of risk and complexity to the fund's investment approach.

• Initial Public Offerings (IPOs)

  Investing in IPOs allows the fund to participate in the early stages of a company's public life. This can offer high growth potential as companies often experience rapid price appreciation post-IPO. However, it also carries significant risk due to the possibility of substantial volatility and price swings. The fund seeks to carefully select IPOs with strong growth prospects in emerging markets, aiming to strike a balance between risk and reward in its overall investment strategy.