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EQUITY PRICE RISK.
−Removed: Our investments in sponsored investment products are carried at fair value, and, as such, these investments are subject to market risk.
+Added: Certain of our investments are carried at fair value, and, as such, these investments are subject to market risk.
The following table presents the equity price risk from our investments.
−Removed: Investments in our sponsored investment products generally moderate market risk as they are diversified and invest in a number of different financial instruments.
−Removed: Rowe Price manages its cash and discretionary investments exposure to market risk by diversifying its investments among various fixed income portfolios.
+Added: The majority of our Investments are in mutual funds which moderate market risk as they are diversified and invest in a number of different financial instruments.
+Added: Rowe Price manages its cash and discretionary investments exposure to market risk by diversifying its investments among various fixed income products.
In addition, investment holdings may be altered from time to time in response to changes in market risks and other factors, as management deems appropriate.
We do not actively hedge the market risk related to our seed capital investments.
−Removed: In order to quantify the sensitivity of our investments to changes in market valuations, we have chosen to use a variant of each product's net asset value to quantify the equity price risk, as we believe the volatility in each product's net asset value best reflects the underlying risk potential as well as the market trends surrounding each of its investment objectives.
−Removed: The potential future loss of value, before any income tax benefits, of these investments at December 31, 2024 was determined by using the lower of each product’s lowest net asset value per share during 2024 or its net asset value per share at December 31, 2024, reduced by 10%.
+Added: In order to quantify the sensitivity of our investments to changes in market valuations, we have chosen to use a variant of each investments net asset value, if available, to quantify the equity price risk, as we believe the volatility in each investments net asset value best reflects the underlying risk potential as well as the market trends surrounding each of its investment objectives.
+Added: The potential future loss of value, before any income tax benefits, of these investments at December 31, 2025 was determined by using the lower of each investment's lowest net asset value per share during 2025 or its net asset value per share at December 31, 2025, reduced by 10%.
In considering this presentation, it is important to note that:
−Removed: not all products experienced their lowest net asset value per share on the same day;
+Added: not all investments experienced their lowest net asset value per share on the same day;
it is likely that the composition of the investment portfolio would be changed if adverse market conditions persisted;
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Additionally, the underlying holdings of our assets under management are also subject to market risk, which may arise from changes in equity prices, credit ratings, foreign currency exchange rates, and interest rates.
−Removed: (in millions) Fair value 12/31/2024 Potential lower value Potential
−Removed: Investments in sponsored products
+Added: (in millions) Fair value 12/31/2025 Potential lower value Potential loss
+Added: Investment in sponsored products
Discretionary investments $ 463.7 $ 417.3 $ 46.4 10 %
−Removed: Seed capital not consolidated 262.8 231.0 31.8 12 %
−Removed: Investments designated as an economic hedge of deferred compensation liabilities 992.8 859.1 133.7 13 %
+Added: Redeemable seed capital investments 316.1 273.5 42.6 13 %
+Added: Investments used to hedge the deferred compensation liabilities 1,243.3 1,028.8 214.5 17 %
Investments in affiliated collateralized loan obligations 3.2 2.9 0.3 9 %
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Direct investment in consolidated investment products
−Removed: Discretionary investments $ 137.5 $ 123.8 $ 13.7 10 %
−Removed: Seed capital 870.7 775.2 95.5 11 %
−Removed: Investments designated as an economic hedge of deferred compensation liabilities 29.7 26.2 3.5 12 %
+Added: Redeemable seed capital investments 819.7 699.5 120.2 15 %
+Added: Investments used to hedge the deferred compensation liabilities 74.0 65.8 8.2 11 %
Total $ 893.7 $ 765.3 $ 128.4 14 %
−Removed: Investment partnerships and other investments held at fair value $ 62.6 $ 55.7 $ 6.9 11 %
−Removed: Any losses arising from the change in fair value of investments in T.
−Removed: Rowe Price products would result in a corresponding decrease, net of tax, in our net income attributable to T.
−Removed: Rowe Price Group, Inc.
+Added: Investment partnerships and other investments $ 154.7 $ 138.4 $ 16.3 11 %
+Added: Any losses arising from the change in fair value of our investments would result in a corresponding decrease, net of tax, in our net income attributable to T.
+Added: Rowe Price Group.
The direct investment in consolidated investment products represents our portion of the net assets of the consolidated investment product.
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Since we are hedging the liabilities, the impact on our net income attributable to T.
−Removed: Rowe Price Group, Inc.
−Removed: would result from any ineffectiveness of this economic hedge.
+Added: Rowe Price Group would result from any ineffectiveness of this economic hedge.
CURRENCY TRANSLATION RISK.
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Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.