Mutual Fund Summary Prospectus (497k)
March 17 2014 - 5:30PM
Edgar (US Regulatory)
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SUMMARY PROSPECTUS
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Royce Select Fund I
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MAY 1, 2013
Investment Class Symbol: RYSFX
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Before you invest, please review the Funds Statutory Prospectus and Statement of Additional
Information dated May 1, 2013 and March 18, 2014, respectively. Each is incorporated by reference (is legally considered part of
this Summary Prospectus). Each contains more information about the Fund and its risks. The Funds
Statutory Prospectus, Statement of Additional Information, and other information about the Fund are
available online at www.roycefunds.com/prospectus. You can also get this information at no cost by
calling Investor Services at (800) 221-4268, sending an e-mail request at
www.roycefunds.com/contact, or by contacting your financial intermediary.
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www.roycefunds.com
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SUMMARY PROSPECTUS
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Royce Select Fund I
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MAY 1, 2013
Investment Class Symbol: RYSFX
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Investment Goal
The investment goal of Royce Select Fund I is long-term growth of capital.
Fees and Expenses of the Fund
The following table presents the fees and expenses that you may pay if you buy and hold shares of the Fund.
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SHAREHOLDER FEES
(fees paid directly from your investment)
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Maximum sales charge (load) imposed on purchases
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0.00%
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Maximum deferred sales charge
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0.00%
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Maximum sales charge (load) imposed on reinvested dividends
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0.00%
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Redemption fee (as a percentage of amount redeemed on shares held for less than 180 days)
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1.00%
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ANNUAL FUND OPERATING EXPENSES
(expenses that you pay each year as a percentage of the value of your investment)
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Management fees
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1.00%
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Distribution (12b-1) fees
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0.00%
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Other expenses
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Dividends on securities sold short
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0.00%
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Other
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1.15%
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Total annual Fund operating expenses
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1.15%
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EXAMPLE
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This example is intended to help you compare the cost of investing in the Fund with the cost of investing in other mutual funds.
The example assumes that you invest $10,000 in the Fund for the time periods indicated and then redeem all of your shares at the end of those periods.
The example also assumes that your investment has a 5% return each year and that the Funds total annual operating expenses remain the same.
Although your actual costs may be higher or lower, based on the assumptions your costs would be:
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1 Year
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$117
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3 Years
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$365
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5 Years
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$633
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10 Years
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$1,398
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Portfolio Turnover
The Fund pays transaction costs, such as commissions, when it buys and sells securities (or turns over its portfolio). A higher portfolio
turnover rate may indicate higher transaction costs and may result in higher taxes when Fund shares are held in a taxable account. These
costs, which are not reflected in annual fund operating expenses or in the example, affect the Funds performance. During the most recent
fiscal year, the Funds portfolio turnover rate was 54% of the average value of its portfolio.
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Principal Investment Strategy
Royce & Associates, LLC (Royce), the Funds investment adviser,
may invest the Funds assets in both long and short positions in
equity securities. The long portion of the Funds portfolio is invested
primarily in a limited number (generally less than 100) of the equity
securities of micro-cap, small-cap, and/or mid-cap companies with
market capitalizations up to $5 billion. Royce selects these securities
from a universe of more than 4,800 companies, generally focusing
on those that it believes are trading significantly below its estimate
of their current worth. In its selection process, Royce puts primary
emphasis on balance sheet quality, cash flows and various internal
returns indicative of profitability, and the relationships that these
factors have to the price of a given security.
Normally, the Fund invests at least 80% of its net assets in equity
securities of micro-cap, small-cap, and mid-cap companies with
market capitalizations up to $5 billion. Although the Fund normally
focuses on the securities of U.S. companies, it may invest up to 15% of
its assets in securities of companies headquartered in foreign countries.
The Fund may sell securities to, among other things, secure gains, limit
losses, redeploy assets into what Royce deems to be more promising
opportunities and/or manage cash levels in the Funds portfolio.
The Fund may seek to capitalize on declines in the market
prices of equity securities or declines in securities indices by taking
short positions in the equity securities of a specific company or
through short sales in passively managed, exchange traded funds
(ETFs) that track performance of a market index. The Fund may
establish such short positions when Royce anticipates a decline
in the market price of a security because Royce believes that (i)
it is issued by a company with a highly leveraged balance sheet
or limited growth prospects and/or that is poorly managed or (ii)
a companys securities, or an ETF, are otherwise over-priced. The
short portion of the Funds portfolio is not subject to any market
capitalization restrictions, and the Fund may short the securities of
larger capitalization companies and market indices. The Fund will
not sell short securities representing more than 35% of its net assets.
The Fund may borrow for the purpose of purchasing portfolio
securities and other instruments. The Fund may borrow from banks
in an amount not to exceed one-third of the value of its total assets
and may borrow for temporary purposes from entities other than
banks in an amount not to exceed 5% of the value of its total assets.
Primary Risks for Fund Investors
As with any mutual fund that invests in common stocks, Royce
Select Fund I is subject to market riskthe possibility that common
stock prices will decline, or that the prices of securities sold short
will increase, over short or extended periods of time. As a result,
the value of your investment in the Fund will fluctuate, sometimes
sharply and unpredictably, and you could lose money over short or
long periods of time.
The prices of micro-cap, small-cap, and mid-cap securities are
generally more volatile and their markets are less liquid relative to
larger-cap securities. Therefore, the Fund may involve considerably
more risk of loss and its returns may differ significantly from funds
investing in larger-cap companies or other asset classes. The Funds
investment in a limited number of issuers and its potential industry
and sector overweights may also involve more risk to investors than
a more broadly diversified portfolio of micro-cap, small-cap, and
mid-cap securities because it may be more susceptible to any single
corporate, economic, political, regulatory, or market event.
The Funds use of short sales involves additional investment risks
and transaction costs. A short sale is a transaction in which the Fund
sells a security it does not own in anticipation that the market price
of that security will decline. The Fund must borrow the security sold
short to make delivery to the buyer and is then obligated to replace
the security borrowed by purchasing it at the market price at the time
of replacement. The price at such time may be more or less than the
price at which the security was sold short by the Fund. The Fund
may have to pay a premium to borrow the security and is obligated
to pay the lender amounts equal to any dividends declared or interest
that accrues during the period of the loan. Under certain market
conditions, short sales can increase the volatility of the Fund and may
lower the Funds return or result in losses, which potentially may be
unlimited. The Fund may not be able to close out a short position at
an acceptable time or price because it has to borrow the securities to
effect the short sale and, if the lender demands that the securities be
returned, the Fund must deliver them promptly, either by borrowing
from another lender or buying the securities in the open market. If
this occurs at the same time other short sellers are trying to borrow or
buy in the securities, or the price of the security is otherwise rising, a
short squeeze could occur, causing the stock price to rise and making
it more likely that the Fund will have to cover its short position at an
unfavorable price. The risk of a short squeeze is significantly higher
when the Fund is seeking to close out a short position in a micro-cap,
small-cap, or mid-cap security than it would be for a larger-cap
security because of such securities lower trading volumes.
Short sales are subject to special tax rules that will impact the
character of gains and losses realized and affect the timing of income
recognition. Short sales entered into by the Fund may increase the
amount of ordinary income dividends received by shareholders and
may impact the amount of qualified dividend income and income
eligible for the dividends received deduction that it is able to pass
through to shareholders.
Investment in foreign securities involves risks that may not be
encountered in U.S. investments, including adverse political, social,
economic, or other developments that are unique to a particular
region or country. Prices of foreign securities in particular countries
or regions may, at times, move in a different direction and/or be
2 | The Royce Fund
Summary Prospectus 2013
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more volatile than those of U.S. securities. Because the Fund does
not intend to hedge its foreign currency exposure, the U.S. dollar
value of the Funds investments may be harmed by declines in the
value of foreign currencies in relation to the U.S. dollar.
The Funds borrowing for investment purposes may increase its
volatility and magnify its losses. Interest and other borrowing costs
may exceed the gain on securities purchased with borrowed funds.
Royces estimate of a companys current worth may prove to be
inaccurate, or this estimate may not be recognized by other investors,
which could lead to portfolio losses.
Investments in the Fund are not bank deposits and are not insured
or guaranteed by the Federal Deposit Insurance Corporation or any
other government agency.
Performance
The following performance information provides an indication
of the risks of investing in the Fund. Past performance does not
indicate how the Fund will perform in the future. The Calendar
Year Total Returns chart shows performance year by year over the
last ten years. The Annualized Total Returns table shows how the
Funds average annual total returns for various periods compare
with those of the Russell 2000 Index, the Funds benchmark index.
CALENDAR YEAR TOTAL RETURNS
in Percentages (%)
During the period shown in the bar chart, the highest return for a calendar quarter
was 21.40% (quarter ended 6/30/09) and the lowest return for a calendar quarter
was -21.87% (quarter ended 12/31/08).
The table also presents the impact of taxes on the Funds returns.
In calculating these figures, we assumed that the shareholder was
in the highest federal income tax bracket in effect at the time of
each distribution of income or capital gains. We did not consider
the impact of state or local income taxes. Your after-tax returns
depend on your tax situation, so they may differ from the returns
shown. This information does not apply if your investment is in an
individual retirement account (IRA), a 401(k) plan, or is otherwise
tax deferred because such accounts are subject to income taxes
only upon distribution. Current month-end performance
information may be obtained at www.roycefunds.com or by calling
Investor Services at (800) 221-4268.
ANNUALIZED TOTAL RETURNS
(12/31/12)
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1 Year
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5 Year
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10 Year
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Return Before Taxes
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13.68
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6.01
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12.84
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Return After Taxes on Distributions
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11.93
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4.84
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10.92
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Return After Taxes on
Distributions and Sale
of Fund Shares
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10.86
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4.89
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10.83
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Russell 2000 Index
(Reflects no deductions for
fees, expenses, or taxes)
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16.35
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3.56
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9.72
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Investment Adviser and Portfolio Management
Royce serves as investment adviser to the Fund. Lauren A. Romeo,
Portfolio Manager of Royce, manages the Fund, assisted by Charles
M. Royce. Ms. Romeo served as the Funds assistant portfolio
manager from 2005-2006, co-managed the Fund from 2006 to
2009, and became the Funds primary portfolio manager in 2009.
Mr. Royce served as portfolio manager at the Funds inception,
became co-manager with Ms. Romeo from 2006-2009, and became
assistant portfolio manager in 2009.
How to Purchase and Sell Fund Shares
Minimum initial investments for shares of the Funds Investment
Class purchased directly from The Royce Fund:
Account Type
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Minimum
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Regular Account
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$2,000
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IRA
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$1,000
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Automatic
Investment or Direct Deposit Plan Accounts
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$1,000
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401(k) Accounts
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None
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The minimum for subsequent investments is $50, regardless of account type.
You may sell shares in your account at any time and make requests
online, by telephone, and by mail. You may also purchase or sell
Fund shares through a third party, such as a discount or full-service
broker-dealer, bank, or other financial intermediary.
Tax Information
The Fund intends to make distributions that may be taxable as
ordinary income or capital gains.
Financial Intermediary Compensation
If you purchase the Fund through a broker-dealer or other financial
intermediary (such as a bank), the Fund and its related companies may
pay the intermediary for the sale of Fund shares and related services.
These payments may create a conflict of interest by influencing
the broker-dealer or other intermediary and your salesperson to
recommend the Fund over another investment. Ask your salesperson
or visit your financial intermediarys website for more information.
The Royce Fund
Summary Prospectus 2013
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More information on The Royce Fund is available free upon
request, including the following:
Annual/Semiannual Reports
Additional information about a Funds investments, together with a discussion
of market conditions and investment strategies that significantly affected the
Funds performance, is available in the Funds annual and semiannual reports
to shareholders. These reports are also available online at
www.roycefunds.com.
Statement of Additional Information (SAI)
Provides more details about The Royce Fund and its policies. A current SAI is
available at
www.roycefunds.com/literature
and by phone. It is also on file
with the Securities and Exchange Commission (SEC) and is incorporated by
reference (is legally considered part of this prospectus).
To obtain more information:
By mail:
The Royce Funds,
745 Fifth Avenue, New York, NY 10151
By telephone:
(800) 221-4268
Through the Internet:
Prospectuses, applications, IRA forms, and additional
information are available through our website at
www.roycefunds.com/literature.
Text only versions of the Funds prospectus, SAI, and other documents filed
with the SEC can be viewed online or downloaded from
www.sec.gov.
You can also obtain copies of documents filed with the SEC by visiting the SECs
Public Reference Room in Washington, DC (telephone (202) 551-8090) or by
sending your request and a duplicating fee to the SECs Public Reference
Section, Washington, DC 20549-1520. You may also make your request by
e-mail at publicinfo@sec.gov after paying a duplicating fee.
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745 Fifth
Avenue | New York, NY 10151 | P (800) 221-4268 | www.roycefunds.com
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RS1-ISI-0314
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