T. Rowe Price QM U.S. Small & Mid-Cap Core Equity Fund (TQSMX)

A diversified approach to long-term capital growth.

Call 800-541-5730 to speak to an investment specialist about the
QM U.S. Small & Mid-Cap Core Equity Fund.

Ticker Symbol:
TQSMX
Fund Status:
Open to new Retail investors  /  Open to subsequent Retail investments
Fund Objective
Quick Stats
Fiscal Year End  December
Morningstar Category  Mid-Cap Blend
Inception Date 02/26/2016
Tax ID 81-1263630
Investment Objective
The fund's objective is to seek long-term growth of capital.
Strategy
The fund normally invests at least 80% of its net assets (including any borrowings for investment purposes) in equity securities issued by small- and mid-cap U.S. companies. The fund defines small- and mid-cap securities as those whose market capitalization, at the time of purchase, falls within the market capitalization range of the Russell 2500 Index. The fund expects to invest predominantly in common stocks, but may occasionally purchase other types of equity securities or equity-related instruments. The "QM" in the fund's name reflects the concept that the fund employs a "quantitative management" strategy relying on quantitative models developed by T. Rowe Price to help identify stocks that could be included in the portfolio. Based on these models, the portfolio is typically constructed in a "bottom up" manner. Stocks are ranked on metrics that capture their valuation, profitability, stability, management capital allocation actions, and indicators of near term appreciation potential. The fund's adviser employs various valuation metrics, such as price-to-earnings, price-to-cash flows, and price-to-book ratios, and compares these ratios with others in the relevant investing universe. The portfolio is generally constructed by buying higher ranked stocks and selecting stocks to sell from those that have a lower rank, subject to overall risk controls and desired portfolio characteristics.
Risk Potential**
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This fund seeks long-term growth of capital through a broadly diversified portfolio of small- and mid-cap U.S. stocks. Because the fund invests primarily in securities issued by small-and mid-cap companies, it is likely to be more volatile than a fund that focuses on securities issued by larger companies. Small- and medium-sized companies often have less experienced management, narrower product lines, more limited financial resources, and less publicly available information than larger companies. In addition, smaller companies are typically more sensitive to changes in overall economic conditions and their securities may be difficult to trade. The fund's strategy relies heavily on quantitative models to analyze data and construct investment portfolios. Relying on quantitative models entails the risk that the models themselves may be limited or incorrect, that the data that the models rely on may be incorrect or incomplete, and that the adviser may not be successful in selecting companies for investment or determining the weighting of particular stocks. Stock prices can fall because of weakness in the broad market, a particular industry, or specific holdings.
**This chart displays relative risk of each U.S. mutual fund listed using standard deviation of returns. Those values are provided in the bars at the top of the chart.

Methodology: We evaluate the standard deviation and its resulting placement within a specific risk/return category on an annual basis. A fund is generally placed in a risk/return category based on the 10-year standard deviation of its performance. If a fund is less than 10 years old, the actual fund performance history is supplemented with the primary prospectus benchmark history to obtain a full 10-year history, or longest time period available up to 10 years. For an Asset Allocation fund with less than 10 years of performance history, sub-strategy returns are used. When a sub-strategy is less than 10 years old, the actual sub-strategy performance history is supplemented with benchmark history to obtain a full 10-year history, or longest time period available up to 10 years.

Risk return categories overlap; a fund with a standard deviation in the overlap between two categories, denoted by a plus (+), is placed so that its risk categorization is better aligned with anticipated return characteristics an investor may experience going forward at the discretion of T Rowe Price.

When a fund has a cash-like benchmark, denoted by a double plus (++), its standard deviation is estimated using only available fund returns. If the fund is less than 10 years old, benchmark returns are not used to obtain a full 10-year history because they would artificially suppress the volatility estimate.

All investments are subject to market risk, including the possible loss of principal. Standard deviation of returns, a measure of price volatility, is one measure of risk. Please consult the funds' prospectuses for a more complete discussion of the funds' risks.
See Glossary for additional details on all data elements.