Nimbus 9 PORTFOLIO MANAGEMENT

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1 Nimbus 9 STRATEGY HIGHLIGHTS Ticker: TRHYX CUSIP: 77958B204 As of December 31, 2018 Institutional High Yield Fund Total High Yield Assets: $29.0 billion 2 Total High Yield Bond Strategy Assets: 1 $16.9 billion 2 Total Fund Assets: $1.4 billion 2 INVESTMENT APPROACH p Focus on BB/B securities, with a measured allocation to lower-quality bonds when valuations are compelling. p Proprietary fundamental research is key emphasis on industries that enjoy stable cash flow and rational competitive environments. p Extensive analyst interaction across sectors and asset classes promotes broad credit perspective. p Disciplined risk management practices employed in conjunction with broad portfolio diversification to manage risk profile. p The fund is subject to interest rate risk. The bonds in which the fund invests are at a much greater risk of default and tend to be more volatile than higher-rated bonds. Diversification cannot assure a profit or protect against loss in a declining market. PORTFOLIO CONSTRUCTION p Diversified portfolio structure of high yield corporate bonds: typically issuers p Industry exposure typically will range +/- 3% around benchmark weight Conservative exposure guidelines to individual issuers: BB issuer: 3% maximum B issuer: 2% maximum CCC issuer: 1% maximum BENCHMARK p J.P. Morgan Global High Yield Index PORTFOLIO MANAGEMENT Mark Vaselkiv Co-Portfolio Manager p 34 years of investment experience; 30 years with T. Rowe Price. p M.B.A., New York University, Stern School of Business p B.A., Wheaton College Rodney Rayburn, CFA Co-Portfolio Manager p 19 years of investment experience; 4 years with T. Rowe Price. p M.B.A., University of Chicago, Booth School of Business p B.S., Georgia Institute of Technology PORTFOLIO SPECIALISTS Michael Lesesne p 27 years of investment experience; 6 years with T. Rowe Price. p M.B.A., Columbia Business School p B.A., Brown University For a complete list of the members of the Fund s Investment Advisory Committee, please refer to the Fund s prospectus. Effective January 14, 2019, Rod Rayburn assumed co-portfolio management responsibility for the fund with the existing co-portfolio manager Mark Vaselkiv. 1 Includes U.S.-registered mutual funds, a sub-fund of a Luxembourg domiciled SICAV, a common trust fund, separate accounts, and subadvised portfolios. 2 Assets reported are as of September 30, FOR INVESTMENT PROFESSIONALS ONLY. NOT FOR FURTHER DISTRIBUTION. p T. ROWE PRICE 1

2 TOP 10 ISSUERS % of Fund Asurion 2.3% INTELSAT 2.0 ALTICE USA 1.8 NRG Energy 1.6 Charter Communications 1.6 UBER TECHNOLOGIES 1.6 BAUSCH HEALTH 1.5 TESLA 1.2 NETFLIX 1.0 STANDARDAERO AVIATION 1.0 Total 15.6% 15 LARGEST INDUSTRIES Institutional High Yield Fund J.P. Morgan Global High Yield Index Over/Underweight 20% 15% 10% 5% 0% -5% Energy Cable Operators Financial Health Care Metals & Mining Utilities Services Info Tech Wireless Communic Satellites Chemicals Broadcasting Food/Tobacco Gaming Automotives PORTFOLIO CHARACTERISTICS Fund J.P. Morgan Global High Yield Index Weighted Average Maturity 6.25 years 5.58 years Modified Duration to Worst 3.92 years 4.17 years Number of Holdings 419 1,635 FOR INVESTMENT PROFESSIONALS ONLY. NOT FOR FURTHER DISTRIBUTION. p T. ROWE PRICE 2

3 CREDIT QUALITY DIVERSIFICATION % of Fund % of Index BBB/BB Rated & Above Fund vs. J.P. Morgan Global High Yield Index -2.3 BB Rated BB/B Rated B Rated B/CCC Rated CCC and Below Credit Default Swaps Default Equities Not Rated Short-Term QUARTER-OVER-QUARTER CHANGE Fund - Prior Quarter (9/30/18) Fund - Current Quarter (12/31/18) 50% 40% 30% 20% 10% 0% -10% BBB/BB & Abv BB BB/B B B/CCC CCC & Below CDS Default Equities Not Rated Short- Term FOR INVESTMENT PROFESSIONALS ONLY. NOT FOR FURTHER DISTRIBUTION. p T. ROWE PRICE 3

4 PERFORMANCE Annualized Institutional High Yield Fund -4.09% -3.13% 6.53% 3.51% 9.75% 6.55% J.P. Morgan Global High Yield Index Current performance may be lower or higher than the quoted past performance, which is not a reliable indicator of future performance. Share price, principal value, and return will vary, and you may have a gain or loss when you sell your shares. To obtain the most recent month-end performance or to request a prospectus or, if available, a summary prospectus containing this and other information, call or visit troweprice.com. Read it carefully. Consider the investment objectives, risks, and charges and expenses carefully before investing. Total return figures include changes in principal value, reinvested dividends, and capital gain distributions. The performance information shown does not reflect the deduction of a 2.00% redemption fee on shares held for 90 days or less. If it did, the performance would be lower. The Fund s expense ratio was 0.50% as of its most recent prospectus. Three Months The fund(s) may have other share classes available that offer different investment minimums and fees. See the prospectus for details. One Year Three Five Ten Fifteen FOR INVESTMENT PROFESSIONALS ONLY. NOT FOR FURTHER DISTRIBUTION. p T. ROWE PRICE 4

5 RISK/RETURN CHARACTERISTICS Five ended December 31, Information Ratio Sharpe Ratio Tracking Error R-Squared Beta Alpha % % 0.87% % Institutional High Yield Fund J.P. Morgan Global High Yield Index Average Annual Return (%) HYI Average Annual Standard Deviation (%) Institutional High Yield Fund J.P. Morgan Global High Yield Index Past performance is not a reliable indicator of future performance. Figures are calculated using monthly data and are net of fees. FOR INVESTMENT PROFESSIONALS ONLY. NOT FOR FURTHER DISTRIBUTION. p T. ROWE PRICE 5

6 ADDITIONAL DISCLOSURES Portfolio Construction: There is no guarantee that the investment will remain within the anticipated ranges of exposure. Weighted Average Maturity is an average of the maturities of the underlying bonds, with each bond s maturity weighted by the percentage of Fund assets it represents. Duration is a calculation that seeks to measure the price sensitivity of the Fund to changes in interest rates. In general, the longer the average maturity or duration, the greater the Fund s sensitivity to interest rates. Duration is a better indicator of price sensitivity because it takes into account the time value of cash flows. Duration to worst is the duration of the bond computed using the bond s nearest call date or maturity, whichever comes first. Unless indicated otherwise the source of all data is T. Rowe Price. Source for J.P. Morgan data: J.P. Morgan. Information has been obtained from sources believed to be reliable but J.P. Morgan does not warrant its completeness or accuracy. The index is used with permission. The Index may not be copied, used, or distributed without J.P. Morgan s prior written approval. Copyright 2019, J.P. Morgan Chase & Co. All rights reserved. Source for Lipper data: Lipper Inc. Lipper Data (excluding Performance and Risk Return exhibits) is estimated by T. Rowe Price based on information provided by Lipper, Inc., and LionShares. T. Rowe Price identifies the funds that compose the Lipper index and builds an aggregate portfolio for the index based on each fund s holdings as provided by LionShares. Please note that the portfolio holdings for each fund within the index are based on the most recent public information that is available, and since the funds have different reporting periods, some of this information may not be current. T. Rowe Price uses a custom structure for sector and industry reporting for this product. Diversification exhibits may not add to 100% due to exclusion or inclusion of cash. Sources for credit quality: Moody s Investors Service and Standard & Poor s (S&P); split ratings (e.g., BB/B and B/CCC) are assigned when the Moody s and S&P ratings differ. T. Rowe Price does not evaluate these ratings, but simply assigns them to the appropriate credit quality category as determined by the rating agency. T. Rowe Price uses the rating of the underlying investment vehicle for credit default swaps. Short-term holdings are not rated. Certain numbers in this report may not equal stated totals due to rounding. Unless otherwise stated, data is as of the report date. Closed to new investors. Open to subsequent investments. This material has been prepared for informational purposes only. The views and opinions stated in this commentary are those of the portfolio managers listed as of the date indicated. These views and opinions are subject to change based on market or other conditions and may differ from those of other T. Rowe Price associates. Actual market and investment results may differ materially from expectations T. Rowe Price. All rights reserved. T. ROWE PRICE, INVEST WITH CONFIDENCE, and the Bighorn Sheep design are, collectively and/or apart, trademarks or registered trademarks of T. Rowe Price Group, Inc. T. Rowe Price Investment Services, Inc., Distributor US FOR INVESTMENT PROFESSIONALS ONLY. NOT FOR FURTHER DISTRIBUTION. p T. ROWE PRICE 6