Royce Micro-Cap Trust (NYSE: RMT) as of Dec 31, 2023

Rhea-AI Summary

Royce Micro-Cap Trust, Inc. (RMT) reported an average weekly trading volume of approximately 625,077 shares and the fund's adviser has over 50 years of small- and micro-cap investment experience. The average annual total return as of 12/31/23 showed positive figures across different time periods. The fund invests in micro-cap companies, with the top 10 positions and sectors reflecting its portfolio composition.

Market Research Analyst

The reported average annual total returns for Royce Micro-Cap Trust, Inc. (RMT) indicate a performance that can be considered robust, especially in the one-year and five-year timeframes where the returns are 16.64% and 13.58% for NAV, respectively. It's important to note that the three-year returns are comparatively modest, which might suggest a more volatile performance in the short-to-mid term. This volatility is inherent in micro-cap investments, as these companies are typically subject to higher market risks due to their size and liquidity constraints.

Furthermore, the difference between the NAV and market price returns is also worth noting. The market price returns are slightly lower than the NAV returns, which could imply a discount on the market price compared to the fund's net asset value. This discount could be attractive to investors seeking entry points into the micro-cap space, but it also reflects the market's perception of the fund's underlying assets and the liquidity risk associated with trading in smaller company shares.

Financial Analyst

From a financial perspective, the fund's expense information and the emphasis on net returns post-advisory fees are critical for evaluating the true performance of the investment. Investors must consider these fees when comparing the fund's performance to other investment opportunities. The fund's investment in micro-cap companies, while offering potentially higher growth opportunities, also increases the risk profile of the portfolio, which should be carefully balanced against an investor's risk tolerance and investment horizon.

The fund's portfolio diagnostics, such as the average market cap and weighted average price-to-book (P/B) ratio, provide insight into the valuation and size of the companies within the fund. A P/B ratio of 2.0x suggests a moderate valuation level for the portfolio's holdings, which could be appealing to value-oriented investors looking for growth potential at reasonable prices. However, investors should be aware of the implications of these metrics in the context of the current market environment and how they compare to historical norms in the micro-cap sector.

Investment Advisor

Investors looking at the Royce Micro-Cap Trust should consider the long-term capital growth objective alongside the risk profile of the micro-cap segment. The portfolio's composition, with top holdings across various sectors such as Information Technology and Industrials, suggests a diversified approach, which can mitigate some of the individual stock risks. However, diversification does not guarantee against loss and the specific risks associated with micro-cap investing, such as lower liquidity and higher volatility, remain pertinent.

The disclosure about closed-end funds trading at a discount to their net asset value is a significant consideration for investors, as it can impact the timing and pricing of entry and exit points. While the fund's shares may offer potential for capital appreciation, investors must also be mindful of the market risks and the possibility of shares trading at a discount, which could affect returns when selling.

NEW YORK, Jan. 29, 2024 /PRNewswire/ --

• Average weekly trading volume of approximately 625,077 shares
• Fund's adviser has more than 50 years of small- and micro-cap investment experience

CLOSING PRICES AS OF 12/31/23
NAV	10.47
MKT	9.24

 

AVERAGE ANNUAL TOTAL RETURN AS OF 12/31/23	NAV (%)	MKT (%)
One-Month*	11.29	11.00
One-Year	16.64	15.86
Three-Year	4.93	5.90
Five-Year	13.58	13.90
10-Year	8.16	8.03

*Not Annualized

Important Performance and Expense Information

All performance information reflects past performance, is presented on a total return basis, net of the Fund's investment advisory fee, and reflects the reinvestment of distributions. Past performance is no guarantee of future results Current performance may be higher or lower than performance quoted. Returns as of the recent month-end may be obtained at www.royceinvest.com. The market price of the Fund's shares will fluctuate, so that shares may be worth more or less than their original cost when sold.

The Fund normally invests in micro-cap companies, which may involve considerably more risk than investing in larger-cap companies. The Fund's broadly diversified portfolio does not ensure a profit or guarantee against loss.

 

PORTFOLIO DIAGNOSTICS
Average Market Cap1	$709.5M
Weighted Average P/B2	2.0x
Net Assets	$520.5M

1Geometric Average: This weighted calculation uses each portfolio holding's market cap in a way designed to not skew the effect of very large or small holdings; instead, it aims to better identify the portfolio's center, which Royce believes offers a more accurate measure of average market cap than a simple mean or median.

2Harmonic Average: This weighted calculation evaluates a portfolio as if it were a single stock and measures it overall. It compares the total market value of the portfolio to the portfolio's share in the earnings of its underlying stocks.

The Price-to-Book, or P/B, Ratio is calculated by dividing a company's share price by its book value per share.

 

Portfolio Composition

 

TOP 10 POSITIONS	% OF NET ASSETS (SUBJECT TO CHANGE)
Transcat	2.9
PAR Technology	2.4
Major Drilling Group International	2.2
nLIGHT	1.8
Camtek	1.8
Mesa Laboratories	1.8
Sprott	1.7
EVI Industries	1.6
Haynes International	1.5
Aspen Aerogels	1.5

 

TOP FIVE SECTORS	% OF NET ASSETS (SUBJECT TO CHANGE)
Information Technology	23.1
Industrials	18.7
Financials	15.1
Health Care	12.6
Materials	9.2

 

Recent Developments
Royce Micro-Cap Trust, Inc. is a closed-end diversified investment company whose shares of Common Stock (RMT) are listed and traded on the New York Stock Exchange. The Fund's investment goal is long-term capital growth, which it seeks by investing primarily in equity securities of companies that, at the time of investment, have market capitalization of $1 billion or less.

Daily net asset values (NAVs) for Royce Micro-Cap Trust, Inc. are now available on our website and online through most ticker symbol lookup services and on broker terminals under the symbol XOTCX. For more information, please call The Royce Funds at (800) 221-4268 or visit our website at www.royceinvest.com

An investor in Royce Micro-Cap Trust should consider the Fund's investment goals, risks, fees, and expenses carefully before investing.

Important Disclosure Information
Closed-End Funds are registered investment companies whose shares of common stock may trade at a discount to their net asset value. Shares of each Fund's common stock are also subject to the market risks of investing in the underlying portfolio securities held by the Fund. Royce Fund Services, LLC. ("RFS") is a member of FINRA and has filed this material with FINRA on behalf of each Fund. RFS does not serve as a distributor or as an underwriter to the closed-end funds.

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SOURCE Royce Micro-Cap Trust, Inc.

What is the average weekly trading volume for Royce Micro-Cap Trust, Inc. (RMT)?

The average weekly trading volume for Royce Micro-Cap Trust, Inc. (RMT) is approximately 625,077 shares.

What is the average annual total return for Royce Micro-Cap Trust, Inc. (RMT) as of 12/31/23?

The average annual total return as of 12/31/23 for Royce Micro-Cap Trust, Inc. (RMT) showed positive figures across different time periods: One-Month (NAV): 11.29%, One-Year (MKT): 16.64%, Three-Year (NAV): 4.93%, Five-Year (MKT): 13.58%, 10-Year (NAV): 8.16%.

What is the fund's investment goal?

The fund's investment goal is long-term capital growth, primarily by investing in equity securities of companies with a market capitalization of $1 billion or less at the time of investment.

What are the top 5 sectors in Royce Micro-Cap Trust, Inc.'s portfolio?

The top 5 sectors in Royce Micro-Cap Trust, Inc.'s portfolio are Information Technology (23.1%), Industrials (18.7%), Financials (15.1%), Health Care (12.6%), and Materials (9.2%).

Where can daily net asset values (NAVs) for Royce Micro-Cap Trust, Inc. be obtained?

Daily net asset values (NAVs) for Royce Micro-Cap Trust, Inc. are available on their website, online through most ticker symbol lookup services, and on broker terminals under the symbol XOTCX.