Performance Review

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Annualized Performance
as of 3/31/2018
3 MO:0.21%
YTD :0.21%
1 YR:12.55%
3 YRS:7.42%
5 YRS:11.43%
10 YRS:7.09%

Past performance is no guarantee of future results. Investment return and principal value 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 that shown here.

For Benchmark information click here

The views expressed in this investment report represent the opinions of PNC Capital Advisors, LLC and are not intended to predict or depict performance of any investment. All information contained herein is for informational purposes and should not be construed as investment advice. It does not constitute an offer, solicitation or recommendation to purchase any security. The information herein was obtained by various sources; we do not guarantee its accuracy or completeness. Fund performance quoted above is for class I shares. Past performance does not guarantee future results. These views are as of the date of this publication and are subject to change based on subsequent developments.

Investments in value companies can continue to be undervalued for long periods of time and be more volatile than the stock market in general. Investments in growth companies can be more sensitive to the company's earnings and more volatile than the stock market in general. International investments are subject to special risks not ordinarily associated with domestic investments, including currency fluctuations, economic and political change and differing accounting standards that may adversely affect portfolio securities. These risks may be heightened
in emerging markets.

PNC Multi-Factor All Cap Fund (class I) returned 0.42% in the first quarter versus a return of -0.64% for the Russell 3000 Index.

Growth factors — both price and earnings momentum — continued to show strength during the quarter, while value factors were weak and stability of earnings factors were neutral.

Collectively, these factors had a mildly positive impact on alpha in the quarter. (The excess return of a fund relative to the return of the benchmark is a fund's. In addition, the Fund's overweight to smaller-capitalization stocks, whose returns led larger-capitalization stocks, was a contributor to relative performance.

Overall, stock selection was the main contributor to the Fund's relative performance during the quarter, with holdings in the Information Technology, Industrials, and Materials sectors contributing the most. That was partially offset by detractions from holdings in the Consumer Discretionary sector.

Sector allocation was a contributor to the Fund's relative performance, with the overweight to the Consumer Discretionary sector and the underweight to the Consumer Staples, Real Estate, and Energy sectors contributing the most. That was partially offset by the underweight to the Information Technology sector.

U.S. equity markets ended the quarter slightly down after a volatile ride, a contrast against the backdrop of continued solid economic growth and strong corporate earnings. The quarter started on a high note, as analysts and company managements revised earnings estimates to reflect the impact of the Tax Cuts and Jobs Act. U.S. equity markets rose in response, as positive earnings estimate revisions significantly surpassed negative revisions, due to an expected continuation of strong company fundamentals.


Market optimism lasted until almost the end of January when the first wave of macro worries hit equities. After peaking on January 26, U.S. equity markets declined for the better part of two weeks amid fears of wage inflation and interest-rate increases. The yield on 10-year U.S. Treasuries climbed to a peak of 2.94% in February, but gyrated to a lower 2.74% by the end of the quarter. Concurrently, U.S. equity market volatility increased significantly for the first time in two years.

As investors tried to refocus on the positives of strong, synchronized global economic growth and rising earnings expectations, two additional macro factors surfaced during the quarter. On March 1, President Trump announced that he intended to impose a 25% tariff on steel imports and a 10% tariff on aluminum imports, which negatively impacted U.S. equity markets, as investors feared these actions would have negative consequences for companies and consumers.

As the quarter progressed, trade concerns escalated and tensions increased. Market participants worried that retaliation from U.S. trading partners might lead to a full-scale trade war, although tensions seem to be easing more recently. In late March, data privacy concerns emanating from developments at Facebook sparked a sell-off among many large-cap technology stocks. It was revealed that a third party mined Facebook user data without permission, which called into question the company's data governance and data privacy controls. These concerns bled through to peer companies in the Information Technology sector.

Despite ongoing concerns regarding inflation, a potential trade war, interest rates, and data privacy, the investment team believes the fundamental earnings growth picture continues to look quite strong. Fourth-quarter earnings grew 15.0% year over year, returning to the double-digit growth the market saw in the first half of 2017. First-quarter 2018 earnings growth estimates for the S&P 500 are forecasted to be 17.3%, which, if reached, would be the highest year-over-year quarterly earnings growth since the first quarter of 2011.


Past performance is no guarantee of future results. Investment return and principal value 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 that shown here. Select a Fund to view the most recent month-end performance information or go to each Fund's snapshot page to view most recent month-end performance as well as any waiver or expense reimbursement information.

The information contained in this piece should not be considered legal or tax advice; questions regarding your specific situation should be directed to your legal or tax advisor.

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You should consider the investment objectives, risks, charges, and expenses of the PNC Funds carefully before investing. A prospectus or summary prospectus with this and other information may be obtained at 800-622-FUND (3863) or pncfunds.com. Please read it carefully before investing.

PNC Capital Advisors, LLC, a subsidiary of The PNC Financial Services Group Inc., serves as investment adviser and co-administrator to PNC Funds and receives fees for its services. PNC Funds are distributed by PNC Funds Distributor, LLC, which is not affiliated with the adviser and is not a bank.

This site shall not constitute an offer to sell or the solicitation of an offer to buy nor shall there be any sale of shares of the PNC Funds in any jurisdiction in which such offer, solicitation or sale would be unlawful.

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