Mutual Fund Spotlight: Value Line Capital Small Cap Opportunities Fund [VLEOX]
By: Ted Black, CFP©
Spring 2023 (Vol. 41, No. 1)
As its name indicates, the Value Line Small Cap Opportunities Fund (VLEOX – Investor Class) is a no-load mutual fund that invests in U.S. based companies that are categorized as “Small Cap”.
What’s 'Cap'? Cap is short for market capitalization. A publicly traded company’s market capitalization is arrived upon by multiplying all of the shares of stock outstanding by the current price of the stock. It’s generally accepted that the small cap universe includes companies that have market capitalizations between $300 million and $2 billion. Clearly, these are not mom and pop shops, but far smaller than behemoths such as Apple or Microsoft, each boasting market capitalizations in excess of $2 trillion!
Since 1998, this fund’s been managed by Stephen Grant. Mr. Grant earned his BA from Stanford, his MBA from Wharton, and has been with Value Line since 1991. Here’s a brief summary of some of his recent remarks about managing the fund: “We believe that small-cap growth companies can be an important part of an investor’s portfolio, as smaller companies have the potential for a longer growth runway compared to large companies. Smaller companies are also often associated with relatively high levels of risk. However, our investment approach is designed to provide for a “smoother ride” for an investor’s portfolio. Rather than seeking headline-grabbing companies that can tend toward high volatility, we own companies with a long- term track record of consistent growth in both stock price and earnings. Such companies have provided greater consistency over time during various economic conditions.”
As a whole, small cap stocks, had a very strong start to the year, moving up almost without pause through early February. We then saw small caps begin to move sideways for a few weeks before giving back about half of the earlier gains. However, as of mid-March, this fund has renewed its uptrend, and as of this writing is up over 7% year-to-date.
Investors have long recognized the advantages of building a diversified portfolio. Depending upon one’s personal situation, a high quality small cap fund may make for a solid addition to a portfolio built for long term success.
Performance annualized and updated through 03/31/2023:
1-Year: -0.40%; 3-Year: +16.90%; 5-Year: +8.85%.
The gross annual expense ratio is 1.16%.
If you’re interested in this fund, or would like a portfolio review to determine if this fund might be an appropriate addition to your portfolio, please call Ted Black, CFP© at 888-878-0001, extension 3.
Statistics and information provided by Morningstar and Value Line Funds. Please visit the Value Line Funds website at https://vlfunds.com for the most recent performance information. The principal value and investment return will fl uctuate so that an investor’s shares, when redeemed, may be worth more or less than their original cost. Returns shown, unless otherwise indicated, are total returns, including any capital gains or losses and all dividend and capital gains distributions. The performance data quoted represents past performance and in no way guarantees future results. Mutual funds are not FDIC insured.
Mutual funds are sold by prospectus. An investor should consider the investment objectives, risks, charges and expenses of the investment company carefully before investing. The prospectus contains this and other information about the investment company. Please contact our office at 888-878-0001 to obtain a prospectus. Please read the prospectus carefully before you invest or send money.
Advisory services offered through Royal Palm Investment Advisors, Inc., a Registered Investment Advisor.