- The portfolio outperformed as concerns over rising COVID infections, slowing US and Chinese growth and stubborn inflationary pressures led the market to weaken modestly.
- Emerging Markets, weighed down by Chinese and Brazilian stocks, underperformed creating a headwind for the portfolio, although India was a strong performer.
- Stock selection benefited relative performance with selection in the Industrials and Health Care sectors contributing most; residual sector allocations detracted from performance.
- New positions were initiated in Brazilian brokerage XP, global medical device maker Medtronic and Chinese dairy product producer Mengniu Dairy; positions in Alibaba and Tencent were liquidated along with New Oriental Education.
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 earnings.