The last time we checked in with Brown Capital Management International Small Company (BCSVX), the fund was reeling from a 2.3% decline in 2025 — a year when the MSCI ACWI ex USA Small Cap Growth Index gained 26%.
The fund is heavy in tech stocks, which sank, and it’s light on materials and industrials shares, sectors that fueled much of the rally in 2025.
And now? Over the first four months of the year, BCSVX, a member of the Kiplinger 25, our favorite no-load mutual funds, declined another 12%, compared with an 11% climb in the aforementioned index.
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That’s not the whole story, however. Early 2026 has been a tale of two periods, the managers say: before the Iran war started and after.
Before hostilities began in late February, a rally in cyclical companies and a collapse in tech shares continued — and so did the fund’s laggardly performance compared with the MSCI ACWI ex USA Small Cap Growth Index.
After the conflict started, though, investors did an about-face, snapping up quality companies that deliver mission-critical products and services to customers, the fund’s bailiwick.
A sentiment switcheroo for this small-cap fund
In the roughly two months following the start of the conflict, International Small Company has held up better than its bogey.
Sectra AB, a Swedish medical-imaging tech company, and U.K.-based online investment platform AJ Bell have gained 27% and 21%, respectively, since late February. Camtek, an Israeli semiconductor capital-equipment firm, has been a big contributor, too. All are among the fund’s top 10 holdings.
After just two months, we’re wary of calling this a turnaround. But we’re also a little weary of this fund’s yearlong slump.
Brown Capital’s International Small Company fund holds just 36 stocks. Tech and healthcare stocks make up 60% of the portfolio combined. It’s a reminder that focused funds can be riskier than those that hold a bigger selection of stocks. We’ve identified a few potential replacements for it in the Kiplinger 25, but we’re holding on for now and will check in with the fund again in a few months.
Note: This item first appeared in Kiplinger Personal Finance Magazine, a monthly, trustworthy source of advice and guidance. Subscribe to help you make more money and keep more of the money you make here.
