- The rebound in cyclical stocks moderated in Q2 with growth outperforming at the end of the quarter; business quality metrics were mixed.
- The portfolio outperformed its MSCI All Country World ex USA Index benchmark with sector allocations and stock selection contributing positively to relative returns.
- Positive stock selection in the Information Technology and Consumer Staples sectors benefited relative returns while selection in the Consumer Discretionary and Financials sectors detracted.
- A new position was initiated in Latin American e-commerce leader MercadoLibre, and the portfolio’s position in Fast Retailing was liquidated due to valuation.
- The portfolio is positioned in our highest confidence and most attractively valued long term secular growth opportunities.
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 International 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. Policies for valuing investments, calculating performance, and preparing GIPS Reports are available upon request. Upon request, free of charge, SGA can provide a list of all portfolio holdings held in SGA’s International portfolio for the past twelve months. Past performance is not indicative of future results. SGA’s earnings growth forecast data is based upon portfolio companies’ Non-GAAP operating earnings.