Delaware Smid Cap Growth Fund


Key features

  • Thematically oriented, concentrated approach to portfolio management
  • Focused on competitively advantaged companies well positioned to participate in major demand trends
  • Dedicated investment team has utilized the same investment philosophy since 1987
Fund information
Inception date03/27/1986
Dividends paid (if any)Annually
Capital gains paid (if any)December
Fund identifiers
Investment minimums
Initial investment$1,000
Subsequent investments$100
Systematic withdrawal balance$5,000
Account features
Payroll deductionYes

On Sept. 25, 2014, Class B shares of the Fund converted to Class A shares.

The performance quoted represents past performance and does not guarantee future results. Investment return and principal value of an investment will fluctuate so that shares, when redeemed, may be worth more or less than their original cost. Current performance may be lower or higher than the performance quoted.

Total returns may reflect waivers and/or expense reimbursements by the manager and/or distributor for some or all of the periods shown. Performance would have been lower without such waivers and reimbursements.

Average annual total return

as of month-end (12/31/2019)

as of quarter-end (12/31/2019)

YTD1 year3 year5 year10 yearLifetimeInception date
NAV (view definition)35.33%35.33%22.34%13.40%15.89%13.63%03/27/1986
Max offer price27.54%27.54%19.96%12.07%15.20%13.43%
Russell 2500 Growth Index32.65%32.65%15.17%10.84%14.01%n/a
1 year3 year5 year10 yearLifetimeInception date
NAV (view definition)8.12%35.33%22.34%13.40%15.89%13.63%03/27/1986
Max offer price1.91%27.54%19.96%12.07%15.20%13.43%
Russell 2500 Growth Index10.57%32.65%15.17%10.84%14.01%n/a

Returns for less than one year are not annualized.

Class A shares have a maximum up-front sales charge of 5.75% and are subject to an annual distribution fee.

Index performance returns do not reflect any management fees, transaction costs, or expenses. Indices are unmanaged and one cannot invest directly in an index.

Expense ratio

The Fund's Class A shares are subject to a blended 12b-1 fee of 0.10% on all shares acquired prior to June 1, 1992 and 0.25% on all shares acquired on or after June 1, 1992. This method of calculating Class A 12b-1 fees may be discontinued at the sole discretion of the Fund's Board of Trustees. Please see the fee table in the Fund's prospectus for more information.

Quarterly total returns @ NAV
Year1st quarter2nd quarter3rd quarter4th quarterAnnual return
Portfolio characteristics - as of 12/31/2019Russell 2500 Growth Index
Number of holdings371,148
Market cap (median) Source: FactSet$6.1 billion1252175000.000000000
Market cap (weighted average) Source: FactSet$7.7 billion6026393744.270000000
Portfolio turnover (last fiscal year)96%n/a
Beta (relative to Russell 2500 Growth Index) (view definition)1.24n/a
Annualized standard deviation, 3 years (view definition)21.83n/a
Portfolio composition as of 12/31/2019Total may not equal 100% due to rounding.
Domestic equities100.1%
Cash and cash equivalents-0.1%

Values in excess of 100% and negative values may appear as the result of certain assets and liabilities. See the Fund's prospectus for securities in which the Fund would typically invest.

Top 10 holdings as of 12/31/2019

Holdings are as of the date indicated and subject to change.

List may exclude cash, cash equivalents, and exchanged-traded funds (ETFs) that are used for cash management purposes. Please see the Fund’s complete list of holdings for more information.

Holdings based by issuer.

Holding% of portfolio
YETI Holdings Inc.5.66%
SiteOne Landscape Supply Inc.5.10%
Pacira Pharmaceuticals Inc.4.70%
Match Group Inc.4.61%
Novocure Ltd.4.41%
RingCentral Inc.4.26%
Zendesk Inc.3.58%
Total % Portfolio in Top 10 holdings45.16%
Sector allocation as of 12/31/2019

List may exclude cash, cash equivalents, and exchanged-traded funds (ETFs) that are used for cash management purposes. Please see the Fund’s complete list of holdings for more information.

Information technology32.9%
Consumer discretionary17.3%
Consumer staples4.7%
Communication services4.6%
Distribution history - annual distributions (Class A)1,2
Distributions ($ per share)
YearCapital gains3Net investment

1If a Fund makes a distribution from any source other than net income, it is required to provide shareholders with a notice disclosing the source of such distribution (each a "Notice"). The amounts and sources of distributions reported above and in each Notice are only estimates and are not provided for tax reporting purposes. Each Fund will send each shareholder a Form 1099 DIV for the calendar year that will provide definitive information on how to report the Fund's distributions for federal income tax purposes. The information in the table above will not be updated to reflect any subsequent recharacterization of dividends and distributions. Click here to see recent Notices pertaining to the Fund (if any).

2Information on return of capital distributions (if any) is only provided from June 1, 2014 onward.

3Includes both short- and long-term capital gains.

Alexander Ely

Alex Ely 

Senior Vice President, Chief Investment Officer — Small-Mid Cap Growth Equity

Start date on the Fund: July 2016

Years of industry experience: 27

(View bio)

You may qualify for sales-charge discounts if you and your family invest, or agree to invest in the future, at least $50,000 in Delaware Funds by Macquarie. More information about these and other discounts is available from your financial intermediary, in the Fund's Prospectus under the section entitled "About your account," and in the Fund's statement of additional information (SAI) under the section entitled "Purchasing Shares."

The table below describes the fees and expenses that you may pay if you buy and hold shares of the Fund.

Shareholder fees
Maximum sales charge (load) imposed on purchases as a percentage of offering price5.75%
Maximum contingent deferred sales charge (load) as a percentage of original purchase price or redemption price, whichever is lowernone
Annual fund operating expenses
Management fees0.70%
Distribution and service (12b-1) fees0.25%
Other expenses0.17%
Total annual fund operating expenses1.12%
Fee waivers and expense reimbursementsnone
Total annual fund operating expenses after fee waivers and expense reimbursements1.12%

1The Fund's Class A shares are subject to a blended 12b-1 fee of 0.10% on all shares acquired prior to June 1, 1992 and 0.25% on all shares acquired on or after June 1, 1992. This method of calculating Class A 12b-1 fees may be discontinued at the sole discretion of the Fund's Board of Trustees.

This commentary is currently not available. Please check back later.

Delaware Smid Cap Growth Fund Quarterly commentary March 31, 2018

Market Review

US equity market performance was mixed during the first quarter of 2018. After major indices hit highs early in the year, the market corrected as a result of rate and inflation fears, and geopolitical concerns such as a potential trade war with China. While these issues temporarily dampened optimism for equities, we believe they are transitory and that the cycle is intact. Job figures and confidence remain strong.

The Fund’s portfolio holdings remain largely unchanged. We view the recent correction as a short-term event that removed excess from the equity markets. We believe the markets could recoup losses and hit new highs later in the year. The reason for our optimism is the strong economic backdrop and the continuing swing from fear to confidence that we are seeing in many sectors. Our themes are broad and should be long lasting. In our view, fundamental impacts should be significant.

Within the Fund

For the first quarter, the Fund had strong relative performance within the technology and consumer discretionary sectors and weaker relative performance in healthcare and industrials, versus its benchmark, the Russell 2500TM Growth Index.

The Fund’s largest contributor to performance during the quarter was Weight Watchers International Inc. Weight Watchers is well-positioned within the healthier-living trend as one of the most recognized and trusted brand names among weight-conscious consumers, in our view. Weight Watchers offers innovative, digital weight-management products through its websites, mobile sites, and apps. In late February 2018, the company delivered a better-than-expected fourth-quarter earnings report and also provided 2018 annual guidance that was significantly above expectations. In addition to the launch of the Weight Watchers Freestyle program in December 2017 (a new program that builds upon the highly successful and effective SmartPoints® system by expanding zero Points® foods), the company reported that total customers were up a notable 23% at the end of the fourth quarter. This resulted in the highest year-over-year subscriber growth seen since 2011. At the start of the year, DJ Khaled, a world-renowned record producer, radio personality, and disc jockey, became a Weight Watchers’ member and a social media ambassador, using his social media channels to document his experience and progress on the new WW Freestyle program. We continue to be encouraged by Weight Watchers’ CEO Mindy Grossman (former CEO of HSN Inc.) as she seems to us highly adept at building brands, cultivating partnerships, and managing a global organization.

Another contributor during the quarter was Match Group Inc., due to solid earnings. Match Group owns several dating sites targeted at different demographics and its recent success is due to the monetization of its Tinder app. Because cell phones have become our primary communication device, people use them for more parts of their daily life, including the creation of new connections. Tinder provides an instant-gratification dating solution and, now that it has reached a critical mass of users, the parent company has begun to monetize that user base through premium packages and advertising. We see this as another example of how new media companies are changing long-established practices.

The Fund’s largest detractor from performance during the quarter was Pacira Pharmaceuticals Inc. The company markets a drug, Exparel®, for the treatment of pain following surgery. Exparel is a long-acting version of a non-opioid pain reliever called bupivacaine. One administration during the surgical procedure can provide pain relief for several days post-surgery. This can reduce the need for opioid narcotics to manage pain in the days following surgery. The drug was first approved in 2011 and has been the source of Pacira’s revenue growth since its commercial launch. Exparel use has been growing but it is still used in only a small percentage of overall surgical procedures. We believe uptake of the drug will continue to increase and even accelerate from recent trends over the next several years as public awareness and scrutiny of the healthcare system amidst the ongoing opioid epidemic migrates the treatment of pain toward non-opioid alternatives. Pacira’s shares have underperformed year to date largely because of mixed feedback from a February Food and Drug Administration (FDA) advisory committee meeting that was convened to review the potential expanded use of Exparel as a nerve blocking agent during surgery for pain relief. The mixed feedback was perceived by investors as a warning that the FDA might not approve the drug for this expanded use. In early April, however, the FDA did grant Exparel an expanded approval as a nerve blocking agent for shoulder surgeries. Pacira’s shares have subsequently rebounded. We believe the stock has further room to rise as Exparel growth trends reaccelerate upon expanded use as a nerve block and as the pressures of public and government scrutiny of the opioid epidemic continue to build.

Dermira Inc. was also a detractor from performance during the quarter. The company develops drugs for the treatment of various dermatological conditions such as acne, excessive sweating, and itchy inflammation of the skin. In March 2018, the company announced negative data from two late-stage clinical trials evaluating a drug candidate for the treatment of acne; the drug failed to meet the studies’ clinical objectives. The negative results were inconsistent with positive results that were seen during earlier-stage clinical trials. Dermira’s shares declined significantly upon the announcement of the trials’ outcome and the company’s subsequent decision to discontinue development of the drug. Following the negative clinical trial results, we exited the Fund’s position during the quarter.


We have not wavered in our thinking that we remain in a bull market. We still see a lack of optimism from others when it comes to equities, which in our view is a healthy environment in which to invest. The trends we have exposure to are broad and continue to proliferate. Technology continues to disrupt large sectors such as banking, content, and transportation. We think there is still a long way to go when it comes to the revolution that is underway in many industries from network innovation.

Geopolitical risks — including trade wars or military conflicts — could arise and compress optimism. Inflation and interest rate fears are also likely to come to the forefront. However, we do not believe either of these issues should drive us into a recession or a bear market in the near term.

Past performance is not a guarantee of future results.

Index performance returns do not reflect management fees, transaction costs, or expenses. Indices are unmanaged, and one cannot invest directly in an index.

[483758] 05/18

The views expressed represent the Manager's assessment of the Fund and market environment as of the date indicated, and should not be considered a recommendation to buy, hold, or sell any security, and should not be relied on as research or investment advice. Information is as of the date indicated and subject to change.

Document must be used in its entirety.

All third-party marks cited are the property of their respective owners.

Frank Russell Company is the source and owner of the trademarks, service marks and copyrights related to the Russell Indexes. Russell® is a trademark of Frank Russell Company.

Carefully consider the Fund’s investment objectives, risk factors, charges, and expenses before investing. This and other information can be found in the Fund’s prospectus and its summary prospectus, which may be obtained by clicking the prospectus link located in the right-hand sidebar or calling 877 693-3546. Investors should read the prospectus and the summary prospectus carefully before investing.

The Fund’s investment manager, Delaware Management Company (Manager), may permit its affiliates, Macquarie Investment Management Global Limited (MIMGL) and Macquarie Funds Management Hong Kong Limited, to execute Fund security trades on behalf of the Manager. The Manager may also seek quantitative support from MIMGL.

Investing involves risk, including the possible loss of principal.

Investments in small and/or medium-sized companies typically exhibit greater risk and higher volatility than larger, more established companies.

Risk is increased in a concentrated portfolio since it holds a limited number of securities with each investment having a greater effect on the overall performance.

Not FDIC Insured | No Bank Guarantee | May Lose Value

Fund Finder

Daily pricing (as of 01/17/2020)

Class APriceNet change
Max offer price$27.93n/a

Total net assets (as of 12/31/2019)

$1.8 billion all share classes

Overall Morningstar RatingTM

Class A shares (as of 12/31/2019)
Class ANo. of funds
3 Yrs4565
5 Yrs4501
10 Yrs5385
Morningstar categoryMorningstar Mid-Cap Growth Category

(View Morningstar disclosure)

The Morningstar rating is based on risk-adjusted returns.

Morningstar ranking (as of 12/31/2019)

YTD ranking222 / 618
1 year222 / 618
3 years34 / 565
5 years54 / 501
10 years10 / 385
Morningstar categoryMorningstar Mid-Cap Growth Category

(View Morningstar disclosure)

The Morningstar ranking is based on historical total returns.

Lipper ranking (as of 12/31/2019)

YTD ranking130 / 630
1 year130 / 630
3 years22 / 561
5 years52 / 489
10 years12 / 372
Lipper classificationLipper Small-Cap Growth Funds Average

(View Lipper disclosure)

The Lipper ranking is based on historical total returns.

Benchmark and peer group

Russell 2500 Growth Index (view definition)

Morningstar Small Growth Category (view definition)

Lipper Small-Cap Growth Funds Average (view definition)

Additional information