The Bloomberg U.S. 2000 Index, a key benchmark for small cap stocks, posted a gain of about 1.70% in Q1 2026. Small caps started the year strong as the index advanced 4.97% in January and a rotation appeared to be happening between large and small cap stocks. However, things began to shift in late February and early March with the onset of the Iran War. This halted the upward trend in stocks as concerns grew about the future of the economy and inflation. The sudden surge in oil above $100/barrel sent shockwaves through the markets fueling inflation fears. Additionally, concerns grew regarding the impact on supply chains and the impact on future economic growth. Looking ahead, prolonged Iran tensions could stall Fed cuts if inflation expectations remain elevated. Fortunately, the domestic focus on small cap stocks has helped insulate them from some of the geopolitical risk. Small caps remain relatively cheap compared to their large cap peers and if peace talks materialize into an end to the war the rotation from large to small may regain momentum.

How did the James Small Cap Fund (JASCX) perform?

How did the fund perform in Q1 of 2026?
The James Small Cap fund gained 4.27% in the first three months of the year. The Bloomberg U.S. 2000 Index advanced 1.70%.

What were the biggest sector contributors and detractors for the fund in Q1 of 2026?
Industrials, Energy, and Consumer Staples were the top contributing sectors to the fund. Financials, Consumer Discretionary, and Communication Services were the primary detractors in the first quarter.

What were the biggest industry contributors and detractors in Q1 of 2026?
Electrical Products and Oil & Gas Production were the top contributing industries for the start of the year. The surge in oil prices was the primary tailwind for the strong performance in the Oil & Gas Production segment.

The lagging industries during the quarter included Investment Banks/Brokerage Firms as competition from AI (Artificial Intelligence) tools worried investors. Additionally, the Apparel and Footwear segment was a segment that underperformed during the quarter.

Which stocks contributed the most in Q1 of 2026?
Powell Industries, Inc., Nova Ltd., and Coca-Cola Consolidated, Inc. were among the top three companies posting the strongest contributions in the quarter.

Definitions

    1. Bloomberg U.S. 2000 Total Return Index – A float market-cap-weighted benchmark of the lower 2000 in capitalization of the Bloomberg US 3000 Index.

Disclosures

You should carefully consider the investment objectives, potential risks, management fees, and charges and expenses of the Fund before investing. The Fund’s prospectus contains this and other information about the Fund, and should be read carefully before investing. You may obtain a current copy of the Fund’s prospectus by calling 1-800-995-2637.

The James Advantage Mutual Funds are distributed by Ultimus Fund Distributors, LLC (Member FINRA/SIPC). Ultimus Fund Distributors, LLC is not affiliated with James Investment Research, Inc.

The performance data quoted represents past performance; past performance does not guarantee future results. The investment return and principal value of an investment will fluctuate so that an investor’s shares, when redeemed, may be worth more or less than their original cost. The Funds’ current performances may be lower or higher than the performance data quoted. Investors may obtain performance information current to the last month-end, within 7 business days, at www.jamesinvestment.com

For standardized performance and expense information, visit: www.jamesinvestment.com/funds/small-cap/