Highlights:
- Portfolio returned 7.3% (Gross) in Q2 and 7.1% (Net) versus 6.2% for the MSCI All Country World Index and 9.2% for the MSCI All Country World Growth Index
- Amazon, Microsoft, and Intuitive contributed most to performance, while MSCI, MercadoLibre, and Infosys detracted most
- New positions were initiated in UnitedHealth and NVIDIA while the position in SAP was sold given lower forecast growth and a less attractive valuation
- Positions in MercadoLibre, Intuitive, Amazon, Salesforce, Adobe, and Heineken among others were trimmed on strength and capital was reallocated to existing positions in Danaher, Atlassian, AIA Group, HDFC Bank, and Novo Nordisk among others on weakness
- Portfolio revenues and earnings are expected to grow by 12% and 19%, respectively, over the next three years versus 4% and 7% for the MSCI ACWI as we continue to expect continued slow macroeconomic and profit growth
The opinions expressed herein reflect the opinions of Sustainable Growth Advisers, LP and are subject to change without notice. Past performance is no guarantee for future results. This information is supplemental and complements a GIPS Report that can be found with composite performance. The securities referenced in the article are not a solicitation or recommendation to buy, sell or hold securities. This commentary is provided only for qualified and sophisticated institutional investors.
Results are presented gross and net of management fees and include the reinvestment of all income. The Net Returns are calculated based upon the highest published fees. The net performance has been reduced by the amount of the highest published fee that may be charged to SGA clients, 0.85%, employing the Global Growth equity strategy during the period under consideration. Actual fees charged to clients may vary depending on, among other things, the applicable fees schedule and portfolio size. SGA’s fees are available upon request and also may be found in Part 2A of its Form ADV. The largest contributors and detractors are determined using a ranking of the absolute contribution to portfolio return by each security held over the period under consideration. Upon request, free of charge, SGA can provide a list of all portfolio holdings held in SGA’s Global Growth portfolio for the year. Policies for valuing investments, calculating performance, and preparing GIPS Reports are available upon request. SGA’s earnings growth forecast data is based upon portfolio companies’ Non-GAAP operating earning.