Value Line Small Cap Opportunities Fund
| Value Line Small Cap Opportunities Fund | |
|---|---|
| Investor Class | VLEOX |
| Institutional Class | VLEIX |
| AUM | $680M |
Stephen E. Grant Senior Portfolio Manager
* EULAV Asset Management (the “Adviser”) and EULAV Securities LLC, the Fund’s principal underwriter (the “Distributor”), have agreed to waive certain class-specific fees and/or pay certain class-specific expenses incurred by the Institutional Class so that the Institutional Class bears its class-specific fees and expenses at the same percentage of its average daily net assets as the Investor Class’s class-specific fees and expenses (excluding 12b-1 fees and any extraordinary expenses incurred in different amounts by the classes) (the “Expense Limitation”). The Adviser and the Distributor may subsequently recover from assets attributable to the Institutional Class the reimbursed expenses and/or waived fees (within 3 years after the fiscal year end in which the waiver/reimbursement occurred) to the extent that the Institutional Class’s expense ratio is less than the Expense Limitation or, if lower, the expense limitation in effect when the waiver/reimbursement occurred. The Expense Limitation can be terminated or modified before June 30, 2019 only with the agreement of the Fund’s board. The Fund’s performance would be lower in the absence of such waivers.
As of 12/31/24, the Fund’s Top 10 Holdings were as follows:
Comfort Systems USA Inc (4.20%),
AAON Inc (3.39%),
ExlService Holdings Inc (3.34%),
Post Holdings Inc (3.21%),
Federal Signal Corp (3.07%),
CACI International Inc Class A (3.02%),
RLI Corp (3.00%),
Ensign Group Inc (2.78%),
EMCOR Group Inc (2.67%),
SPS Commerce Inc (2.65%)
Morningstar™ Categories based on Investor class shares.
There are risks associated with investing in small and mid cap stocks, which tend to be more volatile and less liquid than stocks of large companies, including the risk of price fluctuations.
The performance data quoted herein represents past performance and does not guarantee future results. Market volatility can dramatically impact the fund's short term performance. Current performance may be lower or higher than figures shown. The investment return and principal value will fluctuate so that an investor's shares, when redeemed may be worth more or less than their original cost. Past performance data through the most recent month end is available at vlfunds.com or by calling 1-800-243-2729.
You should carefully consider investment objectives, risks, charges and expenses of Value Line Funds before investing. This and other information can be found in the fund's prospectus and summary prospectus, which can be obtained free of charge from your investment representative, by calling 800.243.2729, or by clicking on the applicable fund at www.vlfunds.com. Please read it carefully before you invest or send money. Value Line Funds are distributed by EULAV Securities LLC. Past performance is no guarantee of future results.
Portfolio holdings are subject to change and should not be considered a recommendation to buy or sell securities. Current and future portfolio holdings are subject to risk.
The average annual returns shown above are historical and reflect changes in share price, reinvested dividends and are net of expenses. Investment results and the principal value of an investment will vary.
The Morningstar Rating™ for funds, or "star rating", is calculated for managed products (including mutual funds, variable annuity and variable life subaccounts, exchange-traded funds, closed-end funds, and separate accounts) with at least a three-year history. Exchange-traded funds and open-ended mutual funds are considered a single population for comparative purposes. It is calculated based on a Morningstar Risk-Adjusted Return measure that accounts for variation in a managed product's monthly excess performance, placing more emphasis on downward variations and rewarding consistent performance. The top 10% of products in each product category receive 5 stars, the next 22.5% receive 4 stars, the next 35% receive 3 stars, the next 22.5% receive 2 stars, and the bottom 10% receive 1 star. The Overall Morningstar Rating for a managed product is derived from a weighted average of the performance figures associated with its three-, five-, and 10-year (if applicable) Morningstar Rating metrics. The weights are: 100% three- year rating for 36-59 months of total returns, 60% five-year rating/40% three-year rating for 60-119 months of total returns, and 50% 10-year rating/30% five-year rating/20% three-year rating for 120 or more months of total returns. While the 10-year overall star rating formula seems to give the most weight to the 10-year period, the most recent three-year period actually has the greatest impact because it is included in all three rating periods.
VLEOX (3 Year / 5 stars / 535 funds; 5 Year / 5 stars / 519 funds; 10 Year / 5 stars / 395 funds; )
VLIFX (3 Year / 5 stars / 480 funds; 5 Year / 5 stars / 442 funds; 10 Year / 5 stars / 358 funds; )
VALLX (3 Year / 2 stars / 1026 funds; 5 Year / 2 stars / 945 funds; 10 Year / 2 stars / 742 funds; )
VALSX (3 Year / 3 stars / 1026 funds; 5 Year / 2 stars / 945 funds; 10 Year / 3 stars / 742 funds; )
VLAAX (3 Year / 5 stars / 679 funds; 5 Year / 3 stars / 627 funds; 10 Year / 5 stars / 485 funds; )
VALIX (3 Year / 3 stars / 679 funds; 5 Year / 3 stars / 627 funds; 10 Year / 4 stars / 485 funds; )
VAGIX (3 Year / 2 stars / 424 funds; 5 Year / 1 stars / 381 funds; 10 Year / 2 stars / 272 funds; )
Source: Morningstar Direct
Would you please comment on the Fund’s performance relative to the Morningstar Small Growth Category for the 1-year period ended December 31, 2024, and for longer-term periods?
For the 1-year period ended December 31, 2024, the Fund’s performance ranked in the top 46% among its peers in the Morningstar Small Growth Category. The Fund has ranked in the top half of its category in each of the last four calendar years.
In addition, the Fund has a more attractive risk/reward profile compared to its Morningstar category peers. The Fund’s performance ranked in the top quartile (25% or better) for the 3, 5 and 10-year periods ended December 31, 2024, and received Morningstar’s “Low” Risk Rating for the same periods. The Fund is the only one in its category (out of 127 unique funds) to have achieved this risk/ reward combination.
We believe the Fund’s relative outperformance during these periods is primarily due to our investment approach. We select a portfolio of companies with steady operating results and a long-term track record of consistent growth in both stock price and earnings.
Please visit the Fund’s performance page for complete performance information.
Source: Morningstar as of 12/31/24
Would you please describe the types of companies in the Fund and share some examples?
Our investment process emphasizes companies with a history of consistent growth in stock price and earnings over multiple years. Accordingly, the portfolio is comprised of companies that have achieved consistent operating results regardless of the economic environment, and that we believe are well positioned for continued growth. Some portfolio examples include:
Small-cap companies are often associated with higher volatility. How does the Fund’s risk profile compare to other Morningstar Small Growth Category funds?
By investing in companies with a history of consistent, steady growth, the Fund has less historical volatility compared to its peers. The Fund’s standard deviation, a measure of volatility, was the lowest in the Morningstar category over the 5 and 10-year periods ended December 31, 2024.
In addition, the Fund’s emphasis on consistent, steady growth has contributed to attractive risk-adjusted returns relative to its Morningstar category peers. The Fund’s Sharpe Ratio, a measure of risk-adjusted return, has outperformed the category average over the 3, 5 and 10-year periods ended December 31, 2024.
Source: Morningstar as of 12/31/24