Summary

• Allspring Special Small Cap Value Fund underperformed the Russell 2000 Value Index during the first quarter, returning -0.06% compared to the index's 4.96% gain.
• Chord Energy Corp. was a top contributor, as the company is executing well and benefiting from higher oil prices while maintaining an attractive reward/risk valuation perspective.
• The fund exited its position in Kyndryl Holdings Inc. after concluding the reward/risk profile had become less compelling relative to other opportunities with clearer growth trajectories.
• Allspring increased its weight in the energy and health care sectors while reducing its weight in the industrials and financials sectors as reward/risk ratios dictated.
• Portfolio management believes active management will be essential to determine who the winners and losers will be in this artificial intelligence sorting phase.

Quarterly review

• The fund underperformed the Russell 2000 Value Index during the first quarter.

• Stock selection in energy contributed the most to relative performance, however it was offset by our underweight to this best-performing sector.

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