- The portfolio generated strong absolute returns while trailing the MSCI All Country World Index (ACWI) as markets continued to rebound led by lesser quality and more economically sensitive companies
- Stock selection and residual sector allocations detracted from performance for the quarter, but contributed positively for the year
- For Q4, stock selection in the Information Technology and Consumer Discretionary sectors detracted most; an underweight in the strongly performing Financials sector and no exposure to Energy hurt relative returns as did an overweight in the Health Care sector
- A new position in human capital management company Workday was initiated and the portfolio’s position in South African insurer Sanlam was sold
- The portfolio is well positioned to generate revenue and earnings growth meaningfully higher than that of the ACWI benchmark over the coming three years with greater predictability and sustainability
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 full disclosure presentation 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, 0.90%, 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. 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 portfolios, calculating performance, and preparing compliant presentations are available upon request. SGA’s earnings growth forecast data is based upon portfolio companies’ Non-GAAP operating earnings.