In the initial quarter of 2026, the AMG GW&K Small Cap Core Fund (Class N) achieved a marginal return of 0.03%, underperforming its benchmark, the Russell 2000® Index, which saw a gain of 0.89%. This period notably highlighted a significant divergence in the small-cap market, with value-oriented strategies substantially outperforming growth-focused ones, exceeding the growth benchmark by 777 basis points. The fund's strategic allocation decisions, including a slight underweight in the energy sector and an overweight in consumer discretionary, collectively resulted in a negative impact of 30 basis points on its performance.

During this quarter, the AMG GW&K Small Cap Core Fund made only two new investment additions—one within the industrials sector and another in information technology. Despite current market dynamics, the fund's management team maintains its long-term conviction in the potential for a cyclical recovery that would broadly benefit U.S. small-cap equities. While recent challenges have tempered this conviction, the fundamental belief in the market segment's eventual rebound remains firm, underscoring a patient and selective investment approach.

The current landscape for small-cap investments, although experiencing some headwinds, continues to present opportunities for discerning investors. The fund's commitment to strategic sector positioning and careful stock selection reflects an adaptive methodology aimed at navigating fluctuating market conditions. Through prudent management and a focus on intrinsic value, the AMG GW&K Small Cap Core Fund strives to deliver long-term growth and resilience, emphasizing that sustained success is built on thorough analysis and a forward-looking perspective.