The managers of the Royce Funds are specialists in investing in small-cap stocks.
In the video below Royce's Jay Kaplan explains why volatility in the market doesn't bother him, instead he welcomes it.
Kaplan says not to panic on days when the market is dropping, but rather to use those days to buy shares of high quality companies on sale.
Kaplan also discusses his preference for avoiding Real Estate Investment Trusts and MLPs which investors have bid up in search of yield. Kaplan doesn't like the leverage that these entities carry nor their reliance on capital market funding.