Sterling Capital Small Cap Value Fund R6 Shares (SCSIX)

Overview

The provided company description outlines a strategy primarily focused on investing in small-capitalization companies. The fund commits to investing at least 80% of its net assets in common stock and securities convertible into common stock, specifically targeting small cap companies. A distinctive identifier for these investments is based on market capitalization. The target companies are those whose market capitalization is below the largest company in the Russell 2000® Index at the time of purchase. This approach indicates a focus on a segment of the market that can potentially offer growth opportunities different from large-cap stocks, potentially trading increased risk for the chance of higher returns.

Products and Services

The fund's investment strategy is encapsulated in its commitment to two primary types of financial instruments:

• Common Stock: This constitutes a significant portion of the fund's portfolio, focusing on ownership shares in small cap companies. The strategy behind investing in common stock is to tap into the growth potential of small capitalization companies, which often have the ability to scale rapidly and increase in value. This kind of investment typically offers voting rights, allowing investors some level of control or influence over company decisions based on the number of shares they hold.
• Securities Convertible Into Common Stock: These are financial instruments such as bonds or preferred stock that can be converted into a predetermined amount of the company's common stock, usually at the discretion of the investor. This approach provides the fund with the flexibility to start with more stable investments like bonds and convert them into stocks as opportunities for growth become apparent. Investing in convertible securities can offer a lower risk entry point into small cap markets, with the added potential upside of converting to equity if the underlying companies increase in value.